Business license tax overview
The Seattle business license tax is applied to the gross revenue that businesses earn. It is sometimes called the Seattle business and occupation tax (B&O tax) or gross receipts tax.
If you do business in Seattle, you must:
- have a Seattle business license
- file a business license tax return
You pay the tax if your annual taxable gross revenue is $100,000 or more.
You do not pay the tax if your annual taxable gross revenue is less than $100,000 or if you have no business activity for the year. You are still required, however, to report your gross revenue, even if zero, to the City of Seattle.
The Seattle business license tax rate varies by business type. For more information, see tax rates and classifications.
How the tax works
Your gross revenue determines the amount of tax you pay. To calculate this amount, multiply your taxable gross revenue amount by the tax rate.
For example, the 2016 retail sales tax rate is 0.00215 (.215 %). So for a taxable gross revenue amount of:
- $100,000, the business pays $215.
- $1,000,000, the business pays $2,150 and so forth.
Guidelines to follow
The Seattle business license tax is not the same as the Washington state B&O tax. You must file your Seattle taxes separately from your state taxes. To learn more about the state B&O tax, visit the Washington State Department of Revenue.
Read the code
You can read the Seattle Municipal Code (SMC) for legal details about the Seattle business license tax.
SMC Chapter 5.45 covers the business license tax.
Seattle business tax rule 5-006 provides further information.