When starting a business, it’s essential to register with a few local agencies. This ensures that you’re ready to pay business taxes, such as the general excise tax (GET; known as sales tax elsewhere) or employer withholding tax.
Selecting a Business Name
Choosing a business name is a crucial step in creating a successful brand. Not only should the name be unique and reflect the nature of your products or services, but it should also be easy to pronounce and understand.
Conducting a Hawaii business name search is essential to ensure that the selected name is available in Hawaii. This will prevent potential legal disputes and help you avoid trademark infringement issues.
In addition, if you intend to operate your business under a trade name (also known as a DBA), you should also register this name with the State of Hawaii. This will make it easier for vendors, banks, and lenders to identify your business. However, registering a trade name does not give you any protection against other businesses using the same name.
Obtaining a Federal Employer Identification Number (FEIN)
A FEIN is like a social security number for businesses and can be obtained by filing an online application with the IRS. The application requires information such as the legal structure of the business (LLC or corporation), the name, and the address.
When starting to work on the papers for the state of Hawaii business registration, it is necessary to obtain FEIN because it creates an entity that separates your assets from those of the business. This allows you to file tax returns and obtain a business bank account.
You must also file for payroll and withhold taxes if you have employees. If you choose a corporate business structure, you’ll also need to file Articles of Incorporation with BREG and appoint a registered agent in Hawaii for the service of process. Also, draft your corporate bylaws to establish internal operating rules for your corporation.
Choosing a Business Structure
The type of structure you choose has a huge impact on your business. It determines everything from how much you pay in taxes to how your assets are protected in case of a lawsuit.
Consider your needs and seek expert advice before choosing a business structure. For example, if you plan to hire employees and want liability protection, you should register your business as an LLC or corporation.
Before filing any forms, carrying out a Hawaii business name availability search and appointing a registered agent to service the process is also a good idea. This will ensure that your business has an identity distinct from other businesses in the state. This will also protect your brand and prevent legal problems down the road.
Obtaining a General Excise Tax License (GET)
If you plan to sell goods or services in Hawaii, you must register for a General Excise Tax (GET) permit. Generally, tangible products and services are subject to GET, but the state has some exemptions. Additionally, if you have employees in the state, you must also register for employer withholding taxes.
You can file your GET returns and pay GE tax directly with the state, but this is often more expensive than using a professional service that offers GET automation for business. You must also report your GET-related income on federal schedules E (for sole proprietorships) and C (for businesses).
This is another area where the right technology can help you ensure compliance with state guidelines. The right solution can simplify tracking and reporting business tax payments, reducing administrative costs.
Obtaining a Business License
Whether your business is an LLC, corporation, or legal structure, you may need to obtain a Hawaii state business license before starting operations. This process can be complicated, and you must consult with a Hawaii business attorney to ensure you meet all the requirements.
Most businesses in Hawaii need to register with the state through Form BB-1, the Basic Business Application, and pay a one-time registration fee of $20. In addition, many occupations require specific licensing and permits, such as a liquor license for retail sales or a permit for travel agencies.
Some businesses must also register for local, state, and federal taxes, including an Employer Identification Number (EIN), withholding tax, sales tax, and other fees. These taxes vary by industry, so it is important to research your situation and speak with a tax professional before beginning operations.
Obtaining a Business Permit
Hawaii businesses may need various permits and licenses depending on the business type. Most of these are obtained through the Department of Taxation. For example, restaurants need a food establishment permit and a liquor license. In addition, businesses that perform work on state highways need a permit to do so.
Forming a business entity such as an LLC or a corporation will also require state registration. The Department of Commerce and Consumer Affairs has a business entity registry and articles of organization that can be filed online or downloaded to print and file by mail.
Obtaining a Business Tax Registration
Hawaii requires businesses to register for income tax withholding and unemployment insurance. This can be done online at the Department of Commerce and Consumer Affairs Business Registration Division portal. Depending on your business structure, you may also need to obtain state or local licenses and permits. LLCs and corporations provide liability protection that safeguards your assets in case of a lawsuit while giving you more options for filing taxes.
Almost all states have an online tool that makes it easier to register for business taxes. For example, the Hawaii business tax website has a software wizard that asks questions and guides you through the process. You can even register for a General Excise Tax account (GET) and other accounts simultaneously. This will save you time and money.
