Taxation & Fees

Overview

Located in a state known for its fiscal responsibility, Loudoun County offers distinct tax advantages and a business-friendly government that puts your taxes in the places they’re needed most.

• State Taxes
  • Corporate Income Tax
  • Sales and Use Tax
• Loudoun County Taxes

State Taxes

Virginia state taxes include:

• A 6 percent corporate income tax rate that has not been increased since 1972
• A 6 percent combined state and local sales tax
• The unemployment insurance tax rate is the second lowest in the nation and is 56 percent lower than the national average
• Virginia has the third lowest average worker’s compensation costs in the nation and has been consistently among the lowest-cost states for over 15 years
• No franchise or net worth tax
• One of the ten lowest effective tax rates for new capital investments, according to Ernst & Young and The Council on State Taxation

Virginia is also known for its fiscal discipline – a discipline that has earned a AAA bond rating from Moody’s, Fitch, and Standard & Poors, a rating that Loudoun County has also achieved.

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Corporate Income Tax

At 6 percent, Virginia’s corporate income tax has not been raised in more than 40 years and is based on a three-factor apportionment formula of payroll, property, and sales. A single-factor apportionment election based on sales is available for manufacturing companies.

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Sales & Use Tax

The total sales and use tax in Loudoun County is 6 percent (5 percent state, 1 percent local). Sellers are subject to a sales tax on gross receipts from retail sales or leases of taxable, tangible personal property. Manufacturing companies are not subject to taxes on purchases used for production and distributors are not subject to taxes on items purchased for resale.

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Loudoun County Taxes

Real property tax: real estate in Virginia is assessed at 100 percent of fair market value and property tax bills are based on the assessment and the real property tax rate, set annually by the Board of Supervisors.

The real property tax rate for fiscal year 2018 is $1.085 per $100 of assessed value.

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County Taxes

• Business professional occupational license (BPOL) tax: business owners must register their business with the Commissioner of Revenue within 30 days of commencing business operations in Loudoun County and must renew their business license each year by reporting gross receipts. See specific tax rates by business category.

• Business tangible personal property (BPPT) tax: businesses must declare furniture, fixtures, computer equipment, machinery, tools, heavy equipment, and other property located in Loudoun County each year. An aggressive depreciation schedule of 50 percent year one and 10 percent each following year until year five applies. See specific tax rates by business category.

A Triple-A Rating for Financial Discipline

With a long tradition of fiscal discipline, Virginia has consistently maintained a AAA rating from Moody’s, Fitch, and Standard & Poors since 2005. Because of this rating, Loudoun County receives the most favorable interest rates available for issuing bonds.