At a glance
- Corporate tax
- 6% / 7% / 8.5%; minimum from $100
- Tax on wages
- Graduated
- Sales tax
- 6% (+1% local option)
- Economic nexus
- $100,000 or 200 transactions
- Minimum wage
- $14.42/hr
- UI wage base
- $15,400
- New-employer UI rate
- 1%
- Paid leave program
- None
- Annual report
- $250, 2½ months after year end
2026 figures, each explained with its source on the area’s page. On top of the federal baseline.
Setup, in order
Register the corporation
Before doing business in VermontApply to the Secretary of State for a certificate of authority ($155).
Open Department of Taxes accounts
Before the first payroll or taxable saleRegister in myVTax for withholding, which also carries the Child Care Contribution, and for sales tax if you have nexus.
Register for unemployment insurance
Before the first payrollRegister with the Department of Labor for unemployment insurance; most new employers pay 1% on $15,400.
Report new hires
Promptly after hireReport each new employee to the state’s new-hire registry.
Insurance, paydays and leave
Before the first hireCarry workers’ compensation insurance, give written notice if paying other than weekly, and set up earned sick time.
Watch the nexus test
MonthlyCheck sales and transactions into Vermont over every rolling twelve months; SaaS is taxable since July 2024.
The six areas
- AccountingAccounting and state tax in VermontVermont taxes corporations at 6%, 7% and 8.5%, with a minimum tax of $100 to $100,000 set by Vermont gross receipts. Apportionment is sales-only and NOLs carry forward 10 years.Corporate tax rates6.0% / 7.0% / 8.5%
- ReceivablesReceivables and sales tax in VermontVermont has taxed SaaS at 6% since July 1, 2024 (7% in local-option towns). Remote sellers register after $100,000 or 200 transactions in any twelve months.Sales tax rate6%
- PayablesPayables and contractors in VermontVermont takes 1099s with Form WHT-434 by January 31, outside the IRS combined program. Since July 2024 the software a startup buys is taxable, so untaxed SaaS owes use tax.1099 filingJan 31
- PayrollPayroll taxes and employer rules in VermontVermont payroll is withholding plus a 0.44% Child Care Contribution, a $15,400 UI wage base at 1% for new employers, weekly paydays by default and final pay within 72 hours of a discharge.SUI wage base$15,400
- ComplianceCompliance and filings in VermontVermont charges $155 to register and $250 a year for the annual report, due 2½ months after year end. The corporate return follows the federal date, with an extra 30 days on extension.Certificate of authority$155
- AdvisoryAdvisory: credits and decisions in VermontVermont’s R&D credit is 27% of the federal credit for Vermont work, carried forward 10 years, and the state publishes who claims it. Three recent rule changes trip up older advice.R&D credit27% of the federal credit
Who you register with
- Vermont Department of TaxesCorporate income tax, sales and use tax, withholding, Child Care Contribution (myVTax)
- Vermont Department of LaborUnemployment insurance, wage-and-hour
- Vermont Secretary of State, Business ServicesCertificate of authority and annual reports
- Vermont State Treasurer, Unclaimed Property DivisionUnclaimed property holder reports
Hiring across the border
An employee who lives in one state and works in another is the most common way a startup ends up registered in two. These are Vermont’s neighbors.
Common questions
Does a loss-making corporation pay Vermont tax?
Yes. Every active corporation pays at least the minimum tax, set by Vermont gross receipts: $100 at $500,000 or less, $500 up to $1 million, $2,000 up to $5 million, $6,000 up to $300 million and $100,000 above that. A seed-stage startup with little Vermont revenue pays $100.
Is SaaS taxable in Vermont?
Yes, since July 1, 2024. Vermont had exempted remotely accessed software since 2015, but Act 183 of 2024 applied sales tax to all prewritten software regardless of how it is delivered. Custom software, and separately stated charges for customizing prewritten software, remain exempt.
How do 1099s get to Vermont?
Directly. Vermont is not part of the IRS Combined Federal/State Filing program. Forms 1099 are filed with the Department of Taxes along with the annual Form WHT-434 by January 31, and anyone filing more than ten W-2s and 1099s combined must file through myVTax.
What is the Vermont Child Care Contribution?
It is a 0.44% payroll tax on Vermont wages that has funded child care since July 1, 2024. The employer pays it and may withhold up to a quarter of it, 0.11%, from employees. It is remitted with Vermont withholding and reported on Form WHT-436.
When is the Vermont annual report due?
Within two and a half months after the end of the fiscal year on record, March 15 for a calendar-year corporation. For a foreign business corporation it costs $250. Missing it can end in a $50 reinstatement fee.
Is there a Vermont R&D credit?
Yes, if you claim the federal research credit on Vermont expenditures. Vermont’s credit is 27% of the federal credit allowed for the year, applies against corporate or personal income tax, and carries forward 10 years. It isn’t refundable, and the Department publishes the names of companies that claimed it each year.
Sources
Checked against each agency’s own page on . Rates and thresholds change, usually on January 1.
- Vermont Department of Taxes — 2025 Form CO-411 instructions
- Vermont Department of Taxes — Corporate income tax
- Vermont Department of Taxes — H.R. 1 (OBBBA) conformity, Act 164 of 2026
- Vermont Department of Taxes — Sales and use tax
- Vermont Department of Taxes — Prewritten computer software
- Vermont Department of Taxes — Local option tax
- Vermont Department of Taxes — Withholding
- Vermont Department of Taxes — Form WHT-434 instructions
- Vermont Department of Taxes — 1099 filing specifications
- Vermont Department of Taxes — Child Care Contribution
- Vermont Department of Taxes — Business tax credits
- Vermont Department of Labor — Unemployment tax rates
- Vermont Department of Labor — UI taxable wage base for 2026
- Vermont Department of Labor — Minimum wage increase starting January 2026
- Vermont Department of Labor — Summary of wage and hour laws
- Vermont Secretary of State — Business Services fees
- Vermont Secretary of State — Annual and biennial reports
- Vermont State Treasurer — Holder information and resources
- IRS Publication 1220 — Combined Federal/State Filing participating states
General information for US companies, not tax, legal or accounting advice for yours. Rules and thresholds change; confirm the specifics with a CPA or the agency before you act on them.