Business Tax Frequently Asked Questions
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- How do I pay my business tax?
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The Treasurer’s office collects payment of all business taxes. You may contact their office at 804-748-1201.
- Is there a late filing penalty for failure to file a return by the prescribed deadline?
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Yes. Chesterfield County ordinance directs the Commissioner of the Revenue to impose a penalty of 10% of the tax assessable for the non-filing or late filing of a renewal/application. This penalty becomes a part of the tax due.
- What if I have multiple locations or multiple lines of business?
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Each individually licensable activity, at each business location must have a separate license.
- I would like to send my information overnight, but UPS, FedEx, etc. will not use a Post Office Box for the address. What address do I use?
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Overnight packages for the Commissioner of the Revenue may be sent to:
Commissioner of the Revenue
Attn: Business Tax
9901 Lori Rd Rm 165
Chesterfield, VA 23832-0908 - How do I authorize someone else to file or act for my business?
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If you have a business representative visiting our offices, calling on behalf of the business, or filing online; please make sure that individual is authorized to act for the company. If that person is not the owner, an officer, or member listed on paperwork previously filed with our office, he or she should not be able to file and will not be given information regarding that business other than what is public information. Written documentation signed by the owner/officer/member of the company authorizing such action may be required. Businesses may use their own format or request a form from the Business Section.
- Are there any additional requirements if a business is advertising to go out of business, and selling remaining inventory?
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Under the Code of Virginia Section §18.2-223, it is unlawful for a retail business to advertise a “going out of business” sale without first obtaining a permit from the city, county or town where the sale will be conducted. The cost for the application is $50.00 and expires after sixty (60) days. All applications for “going out of business” permits shall be accompanied by an inventory, including the kind and quantity of all goods which are to be offered for sale during the sale and only the goods specified in the inventory list may be advertised or sold during the sale period. The license may be extended once after the initial issuance of the permit with an updated inventory list for an additional $50.00.
- What do I need to do to close my business?
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In order to close your business and end your tax liability for a specific business account, you must notify the Office of the Commissioner of the Revenue in writing. Fax, mail, or email and supply the following information: Name of the Business Owner, Trade Name of the Business, Federal Employer Identification Number (FEIN) or Social Security Number (SSN) associated with the accounts, and the account numbers, along with the exact date the business closed. This statement must be signed by the owner or an officer listed with our office.
- If I do not renew my business license, am I considered out of business?
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No, but you may be considered non-compliant. Once you have received your first business license, you are considered "in business" until you declare in writing to our office that you are "out of business."
- I have concerns regarding neighbors in home business. Who should I contact?
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The Chesterfield County Department of Community Enhancement allows certain businesses and occupations to be conducted in a dwelling unit provided they comply with certain restrictions. They can be reached at 804-748-1500.
- What is Business Tangible Personal Property (BPP)?
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Business tangible personal property is any furniture, fixtures, tools, or equipment that is used or available for use in a business. It includes fixed assets, but does not include supplies (such as pens and paper) or real estate. For a more detailed list of applicable assets, see Sections One and Two of the BPP return form.
- What is the due date for the business tangible personal property tax return?
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The due date for the business tangible personal property tax return is March 1.
- Can I get an extension of time to file the return?
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Yes, but your request must come in writing and be faxed or postmarked by March 1. An extension will be granted for no longer than 60 days.
- What is the tax rate?
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The current tax rate is $3.60 per $100 of assessed value (that is, 3.6% of the value). The rate is set each year by the board of supervisors.
- What if I went out of business?
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You must notify our office in writing that you went out of business. If your BPP is on commercial property and is still available for use in business after you went out of business, you are responsible to continue to report it until it is removed or made unavailable for use in the business . Note that BPP is not pro-rated.
- What if I purchased or recapitalized an item on January 1?
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Report the item on the form and use a 90% assessment factor. Include a note on the "Total" line that these assets are included there.
- What if I am a sole proprietor and I own the equipment personally?
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You must still report any tangible equipment that is used or available for use in your business.
- What if I own no equipment?
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You must write "None" on the return and still send it in, along with an explanation of owning no equipment.
- If you lease equipment, then report it in Section Three of the return.
- You are required to file the return no matter how much equipment you have.
- You may be asked to provide a copy of the lease agreement.
- Do you allow for technological obsolescence?
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Yes, for certain computer equipment and peripherals, as described in Section Two of the return.
- Computers and peripherals are assessed using a more progressive schedule of assessment factors, found in Section Two.
Note: "Computerized" equipment is not the same as a computer or peripheral and would usually be reported along with all other equipment (in Section One), not with computer equipment in Section Two.
- What if I do not depreciate anything?
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- You must still file the form and report all equipment used or available for use in the business.
- You must include an itemized list of all equipment; and you may be asked to provide a copy of your federal Schedule C or Form 1120 in lieu of the required copy of your federal depreciation schedule.
- What do I need to attach to my form?
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Attach the following:
- An itemized list of all property reported
- A copy of your most recent federal depreciation schedule (Form 4562), if you filed one (If you did not file a federal depreciation schedule, you may be asked to provide other supporting documents, including federal Schedule C or Form 1120 in lieu of the Form 4562)
- How do you determine who is a manufacturer or processor?
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Taxpayers must complete a Business Classification Information (BCI) sheet (not online) explaining the process and nature of your business activities. Process flow charts, pictures and site visits may also be used for a determination.
- What assets should be filed as M&T?
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Any assets used directly in the manufacturing process, or used in connection with machinery that is directly used, will be filed as M&T.
- What about idle and unused equipment?
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Machinery and tools may be reported as "Idle and Unused" if:
- They have been discontinued in use continuously for at least one year prior to January 1 of the current tax year.
- On and after January 1, 2017, have been specifically identified in writing by the taxpayer to the commissioner of the revenue on or before April 1, 2017, that the machinery and tools would be withdrawn from service before January 1, 2018, not in use on January 1, 2018, and no reasonable prospect exists that the machinery and tools will be returned to use prior to January 1, 2019.
- What is the deadline for filing M & T?
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The filing deadline for Machinery and Tools is March 1.
- Is there a penalty for not filing M & T on time?
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There is a 10% late filing penalty assessed on all returns not postmarked by March 1.
- What is Short Term Rental Tax?
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A rental tax from the lessee of the daily rental property at the time of the rental for periods of 92 consecutive days or less.
The term short-term rental property does not include trailers or other tangible personal property required to be licensed or registered with the department of motor vehicles, department of game and inland fisheries, or the department of aviation.
- What are the effects of certification as a short-term rental company?
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Local taxes for rental businesses that become certified short-term rental businesses are affected in the following ways:
- Rental inventory is no longer subject to the business tangible personal property tax,
- The business license classification for rental revenue is that of "retail merchant," as opposed to "personal service" for non-certified rental businesses
Certified businesses will receive a certificate which must be displayed in each qualified location.
- What is the application deadline for certification?
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The deadline to apply for renewal certifications is January 31 of the current tax year.
- For new businesses seeking first-time certification as a short-rental business, an application is expected within 30 days (consistent with the grace period for filing the business license application itself).
- Are there any extensions to the January 31 date for renewal applications for certification?
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No. Applications for renewal of certification must be postmarked by January 31 of the tax year for which certification is sought.
- What if a previously-certified short-term rental business misses the deadline for renewal or otherwise does not qualify for certification in a subsequent year?
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The effects of certification are reversed.
- The rental inventory reverts to business tangible personal property taxable status, and the business license classification reverts to that of "personal service."
- Certification (or lack thereof) is an annual process, meaning that businesses that are certified one year may not be certified the next, and vice-versa.
- What is the tax rate?
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The heavy equipment tax rate is 1.5% and for all other property the rate is 1%.
- If I collect Short-Term Rental tax, do I have to have a business license as well?
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Yes, you are required to obtain a Business Professional and Occupational License tax and report your gross receipts.
- What are the due dates for the reporting and remittance of Short-Term rental taxes collected?
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Short term rental tax is filed quarterly.
April 30 January - March
July 31 April - June
October 31 July – September
January 31 October - December - Is there a late filing/payment penalty for failure to file or remit a return by the prescribed deadlines?
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Yes. Chesterfield County Commissioner of the Revenue to impose a penalty of 10% of the tax assessable for the non-filing or late filing/payment of a tax return. This penalty becomes a part of the tax due.
- What records must I keep regarding Short-Term Rental tax?
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Businesses responsible for the collection and remittance of Short-Term Rental tax should keep accurate records for the current and three prior calendar years. These records are subject to audit by the Office of the Commissioner of the Revenue.
- What is Transient Occupancy Tax (TOT)?
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Transient Occupancy Tax (TOT) is a monthly tax collected by operators of public and private hotels, hostelry, inns, motels, tourist home or house, tourist cabin, boarding houses, campgrounds, and other lodging places that offer guest rooms or other accommodations rented out for continuous occupancy for fewer than 30 consecutive days.
- Who is exempt from TOT?
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Transients who stay 30 consecutive nights or more, are exempt from Chesterfield County TOT.
- What are the due dates for the reporting and remittance of transient occupancy taxes collected?
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Transient reports and remittances are due on or before the 20th day of each month covering the amount of tax collected during the preceding month.
- What is the penalty for late filing or remittance of the TOT?
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A penalty in the amount of 10% of the tax due, or $10.00, whichever is greater will be due. Interest will accrue on the amount due at a rate of 10% per year, calculated monthly beginning on the first day of the month following the delinquency.
- What do I do if TOT was collected from a transient in error?
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If a tax was collected in error, it should be returned to the transient who was improperly charged. If the hotel, motel, boarding house, travel campground, or other facility cannot return the improperly collected tax to the rightful payer, the law requires that it must be remitted to the county with other TOT collections and not retained by the operators of lodging establishments as additional income.
- What records must I keep regarding TOT?
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Businesses responsible for the collection and remittance of TOT should keep accurate records for two calendar years. These records are subject to audit by the Office of the Commissioner of the Revenue.