Is Washington right for you?
Washington is home to Amazon, Microsoft and a deep bench of technology companies, and it charges no personal or corporate income tax. For a software or SaaS business wanting a credible U.S. base, the address carries genuine weight.
The complication is the Business & Occupation tax. Washington taxes gross receipts rather than profit, which means a company can owe B&O tax in a year it made a loss. Rates vary by activity classification, and the mechanism surprises founders who came for the no-income-tax headline.
For a non-resident earning outside Washington, B&O generally does not apply — it reaches revenue attributable to the state. But it is the first thing to understand before choosing Washington, not the last.
- SaaS and technology companies wanting a recognised tech-corridor address
- Businesses with a genuine Seattle-area presence
- Companies selling into the Pacific Northwest
- B&O tax is charged on gross revenue, not profit — payable even in a loss-making year
- The $60 annual report is due on your anniversary and enforced strictly
- Rates vary by business activity classification, which needs getting right
What Washington taxes
A summary, not advice — your actual position depends on where you live, where your customers are, and how the company is treated federally.
Income tax
No personal or corporate income tax
Sales tax
6.5% state rate plus local, often above 10% in the Seattle area
Franchise tax
No franchise tax. Business & Occupation tax applies to gross receipts instead
Washington for a non-resident founder
No residency requirement, strong banking familiarity, and a technology reputation that helps with payment providers. Get advice on B&O exposure before committing.
What Washington asks for every year
Formation is the easy part. These are the obligations that keep the company alive — and the ones people forget.
- 01
Annual Report
Due by the end of your anniversary month, $60. Late filing adds penalties and risks administrative dissolution.
- 02
Business & Occupation Tax
Filed with the Department of Revenue on Washington-attributable gross receipts. Frequency depends on volume.
- 03
Registered Agent
A Washington street address, maintained continuously.