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Virginia has more than 780,000 small businesses, employing more than 1.6 million people, nearly half of the state’s workforce. This makes it a powerful and receptive market to start a business. But there will always be state-specific hurdles to jump when it comes to starting a business, as well as many advantages and disadvantages. This step-by-step guide will walk you through the pros and cons of starting a business in the Commonwealth of Virginia. Here’s what you have to do.

 

  1. Choose a business idea 

Choosing a strong business idea may seem like the easy part, but it’s only 1% inspiration and 99%, you know. It’s not just about deciding which product or service to offer, it’s about understanding both your customer and your market. 

  1. Name your business 

Naming your new business in Virginia is like introducing yourself to the state, so it’s one of the most important decisions you’ll make as an entrepreneur. Once you’re registered, it will affect many other critical decisions, including branding, marketing, and customer retention. Your name will embody all of your identity, so it is an important decision for you early on. Here are some things to consider when choosing a business name: 

Use a DBA in Virginia 

If you want to add a DBA (“doing business as”) or title to your business in Virginia, also known as a business name, you will need to register with the State Corporation Commission, and you can do so . online or in paper. . type. The process depends on the region, but expect to fill out an application and pay a $10 application fee. Unlike a trade name, a pseudonym, which DBA falls under, does not have to be unique.

  1. Create a business plan 

Before starting a business, you must have a business plan. Think of it as a basic road map that outlines your steps to success. A solid business plan should include the following: 

If you need a start, here is a free business plan template you can use as a solid foundation to build and create your own. If you need inspiration, here are some examples of good business plans.

 

  1. Choose a business plan and get started 

Once you’ve decided on a name and established a business plan, you’re off to a good start. Perhaps one of your most important choices is your business structure, which will determine how your business is taxed, how easy it is to lock in an investment, and how liable you will be if things go wrong. do. 

Types of business entities offered in Virginia include sole proprietorships, which are owned by one person; relationships with two or more people; companies or legal entities and their owners; and a limited liability company (LLC), which consists of a corporation and partnership.

The process you decide on for your business will determine its tax rate. All Virginia corporations are taxed at a rate of 6% of taxable income and must pay an annual filing fee ranging from $100 to $1,700. If your business is a wholesale business that sells certain products, you will also pay state sales tax, which varies depending on the type of product and whether it is sold at a distance, in a store. , or for consumption (such as food, alcoholic beverages). drinks or tobacco). For more information on Virginia business taxes, visit the official Virginia Tax website. 

Get an EIN 

Once you’ve decided how to register your business in Virginia, you’ll need an Employer Identification Number (EIN). This nine-digit number works similarly to a Social Security number, but the IRS in the state of Virginia has assigned it to a new entity for tax purposes. An EIN makes it easier to file federal and state taxes, and can help secure lines of credit and business credit cards.

Virginia Incorporation 

Obtaining an EIN in Virginia is part of the statewide registration process. To incorporate your business in Virginia, you will need to file a Articles of Incorporation (for corporations) or Articles of Association (for LLCs) with the State Corporation Commission. Here’s what you’ll need to register your business with the tax authorities once it’s set up:  

By registering online, you save time by creating an online service account that you can also pay taxes for your business.

  1. Obtain business licenses and permits 

In Virginia, the only permit or license that any business must obtain at the state level is a sales tax form, which can be obtained here. In addition, some artists and customers may require other specific licenses and permits, which you can review here.

  1. Explore insurance options in Virginia 

As a business owner, there are bound to be situations that are beyond your control. For all of these and more, it’s worth getting professional insurance. This helps protect your business and assets in Virginia if the unexpected happens. The State Corporation Commission has a handy PDF for determining what type of insurance your business may need. A few types of insurance in Virginia include:  

 

  1. Understand financial matters 

Starting a business costs a little money up front, but it will be worth it when you start seeing the profits coming in. In addition to insurance, you will need to rent space for a shop or office, pay to register a domain and have a website designed, place advertisements in appropriate publications and perhaps even billboards, and invest in hardware and software. You may also want well-known professionals with expertise such as lawyers and accountants, for example, to do this important work for you. It can really add up, but luckily there are quick and accessible options for seed money.

 

  1. Your market 

When you’re ready to introduce your Virginia small business to the world, you’ll need a great business plan. Here are the main things to consider: 

New business and customer retention. Good customer relations are always key, so make sure you keep them coming back and telling their friends, family and colleagues about you.

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