Good to know
Good to Know
- No local partner, sponsor, or resident co-owner is required to incorporate in Hawaii — foreign nationals can own 100% of a Hawaii LLC or corporation, same as any U.S. state.
- The one mandatory local requirement is a registered agent with a physical (non-P.O. box) Hawaii street address — most non-resident founders simply hire a commercial registered agent service for this rather than trying to use their own address.
- The General Excise Tax (GET) license from the Hawaii Department of Taxation is a separate step from registering the LLC/corporation itself, but is required for almost any active business — don't assume the DCCA filing alone makes you fully compliant.
- Getting a U.S. business bank account as a non-resident without a Social Security Number can be the slowest, most friction-filled part of the whole process — often the practical bottleneck is not government paperwork but banking access.
- If forming a company in another U.S. state (e.g., a Delaware or Wyoming LLC) but actually operating/living in Oahu, you'll likely need to additionally register that entity as a 'foreign LLC/corporation' doing business in Hawaii, which carries its own separate filing fee.
- Hawaii's General Excise Tax (GET) is often mistaken for a sales tax by newcomers — it isn't. It's charged on your business's total gross revenue with no deduction for expenses and no small-business exemption, so it applies to freelancers and consultants just as much as to shops.
- On Oahu specifically, the effective GET rate is 4.5% (4% state + 0.5% Honolulu County surcharge); if you itemize it on invoices the correct pass-on rate to display is 4.712%, not a flat 4.5%.
- Get your $20 GET license before your first dollar of Hawaii revenue — this applies even to solo freelancers/consultants, not just registered companies.
- If you're a non-US person forming a US LLC to operate from Oahu, budget for real accounting help: the combination of Hawaii's GET, Hawaii state income tax, and the federal Form 5472 foreign-ownership reporting (with a $25,000 penalty for missing it) is genuinely more complex than a typical US state's tax setup.
- The word 'foreign' shows up in two unrelated senses here: Hawaii's DCCA calls any company formed outside Hawaii (even one from another US state) a 'foreign entity' needing separate registration, while the IRS uses 'foreign-owned' to mean owned by a non-US person — don't confuse the two when reading official guidance.
General Excise Tax GET
- Citation Oahu Rate
- Hawaii GET rate is 4% statewide + 0.5% Oahu surcharge. Pass-on rate: 4.7120%.
- What It Is
- Hawaii has no general sales tax. Instead it levies the General Excise Tax (GET), a tax on the business itself for the privilege of doing business in the state, calculated on GROSS receipts (not profit) with essentially no small-business exemption.
- Passing It On
- Passing GET to customers is optional (it can instead be absorbed into pricing), but if shown on a receipt it must be labeled correctly as GET, never as 'sales tax'.
- Citation Pass On
- You cannot call it "sales tax"—it should be labeled as "GET" or "Hawaii General Excise Tax" or similar language that accurately describes it.
- Citation Freelancer
- Almost all business income in Hawaii is subject to GET, including freelance and service-based work.
- Citation Gross Basis
- GET is a gross receipts tax applied directly to businesses on their total income, not to consumers on individual transactions... businesses owe GET whether or not they make a profit.
- Citation No Threshold
- There is no minimum threshold... If you earn $1 doing business in Hawaii, you owe GET on that dollar.
- Applies To Freelancers And Services
- GET applies to virtually all business activity — retail, professional services, freelance/consulting work, commissions, and rentals — not just goods.
- Short Term Rental Note
- Landlords/short-term rental hosts on Oahu should assume both GET and the separate Transient Accommodations Tax (TAT) apply, as these have different rates and filing requirements.
Rates
- Standard Rate Percent
- 4
- Insurance Commission Rate Percent
- 0.15
- Total Effective Rate Oahu Percent
- 4.5
- Wholesale Intercompany Rate Percent
- 0.5
- Oahu Honolulu County Surcharge Percent
- 0.5
- Pass On Rate If Itemized On Invoice Percent
- 4.712
State Corporate Income Tax
- Citation
- Hawaii imposes a corporate income tax on domestic and foreign corporations, other than financial corporations, carrying on a trade or business in, or deriving income from sources within, the state.
- Applies To
- C-corporations only (including LLCs that elect C-corp tax treatment). Does not apply to default pass-through LLCs or sole proprietors, whose profits flow to personal state income tax instead.
- No Franchise Tax
- Yes
- Description
- Hawaii levies a graduated state corporate income tax on domestic and foreign (i.e., non-Hawaii-formed) corporations doing business in the state.
- Franchise Tax Note
- Unlike many US states, Hawaii does not impose a separate corporate franchise tax on general corporations (banks/financial institutions instead pay a separate state franchise tax in lieu of corporate income tax).
Brackets
Taxable income up to $25,000
- Rate Percent
- 4.4
minus a $250 credit
- Rate Percent
- 5.4
- Bracket
- $25,000–$100,000
minus a $1,250 credit
- Rate Percent
- 6.4
- Bracket
- Over $100,000
Freelancer Sole Proprietor Vs Forming A Company
LLC Or Corporation
- Cons
- Adds DCCA registration, the $15/year annual report fee, ongoing Form 5472/1120 federal compliance if foreign-owned, and generally requires professional bookkeeping given Hawaii's unusual GET system layered on top of income tax.
- Pros
- Provides liability protection, is usually required by US banks/payment processors and many clients, and allows electing pass-through (default LLC) or C-corp tax treatment.
- C Corp Election
- An LLC (or a standard corporation) can instead elect/be taxed as a C-corp, paying the 21% federal rate plus Hawaii's 4.4–6.4% graduated state corporate rate, but this creates double taxation on dividends and is usually only worthwhile for specific investment/scaling reasons.
- Citation Passthrough
- Hawaii LLCs are typically treated as pass-through entities, meaning profits and losses are passed through to the owners' personal income tax returns.
- Default Tax Treatment
- A Hawaii LLC is a pass-through entity by default — no entity-level state or federal corporate income tax; profits flow to the owner's personal return.
Sole Proprietor Freelancer
- Cons
- No liability shield — the individual's personal assets are exposed to business debts/claims; a non-US-citizen operating this way in the US must still separately resolve their personal immigration/work-authorization status, which is a distinct issue from tax filing.
- Pros
- Simplest and cheapest path — no DCCA registration, no annual report fee, no separate federal EIN strictly required (though many still get one).
- Still Required
- Must still obtain the $20 Hawaii GET license and file GET returns — GET applies to freelance/service income exactly as it does to a company.
Incorporation Process And Requirements
- Realistic Timeline
- For a brand-new Hawaii LLC filed online through Hawaii Business Express: name check is instant, and standard filings are processed within about 7-10 business days (2-3 business days if the $25 expedite fee is paid), plus mail time for paper filings. The GET license and EIN can typically be arranged in parallel. The realistic bottleneck for a foreign (non-U.S.) founder is not the state filing itself but obtaining the EIN without a Social Security Number/ITIN — this must go through the IRS's fax/mail process rather than the instant online tool and can add weeks. Overall, a foreign founder using a registered agent service should expect roughly 1-3 weeks for the entity itself to be legally formed, with EIN and full banking setup sometimes taking several additional weeks.
- Official Registry Link
- https://cca.hawaii.gov/breg/ (Hawaii DCCA Business Registration Division) — online filing portal: https://hbe.ehawaii.gov
- Local Partner Or Sponsor Requirement
- None. Hawaii, like all U.S. states, permits 100% foreign ownership of an LLC or corporation — a non-U.S. citizen or non-resident does not need a local co-owner, sponsor, or nominee shareholder. The only mandatory local presence is a registered agent (an individual or commercial service with a physical Hawaii street address) whose role is limited to receiving legal/official mail on the company's behalf — this is a formality, not an ownership or equity stake.
- Jurisdiction Context
- Oahu is part of the City & County of Honolulu, State of Hawaii, USA. There is no separate 'Oahu' business registry — all company formation is handled at the state level by the Hawaii Department of Commerce and Consumer Affairs (DCCA), Business Registration Division (BREG).
Typical Costs
Domestic LLC — Articles of Organization (Form LLC-1)
- Domestic LLC — Articles Of Organization (Form LLC 1)
- $51
$50 filing fee + $1 mandatory state archives fee.
Domestic Corporation — Articles of Incorporation
- Domestic Corporation — Articles Of Incorporation
- $51
$50 filing fee + $1 state archives fee, same structure as LLC filing.
Foreign LLC/Corp — Certificate of Authority (If Already Incorporated Elsewhere)
- Foreign LLC/Corp — Certificate Of Authority (If Already Incorporated Elsewhere)
- $51
Form FLLC-1 (LLC) or FC-1 (corporation), $50 + $1 archive fee.
Expedited Processing (Optional)
- Expedited Processing (Optional)
- $25
Cuts state processing from ~7-10 business days down to ~2-3 business days.
General Excise Tax (GET) License — Form BB-1
- General Excise Tax (GET) License — Form BB 1
- $20
One-time license fee with the Hawaii Department of Taxation, required for nearly all business activity.
Annual Report (Recurring, Every Year)
- Annual Report (Recurring, Every Year)
- $15
Slightly cheaper (~$12.50-13.50) if filed online vs. paper.
Commercial Registered Agent Service (Recurring, Annual)
- Commercial Registered Agent Service (Recurring, Annual)
- $100
Not a government fee — a private-market cost. Ranges roughly $49-150/year depending on provider; effectively mandatory for a foreign founder without a personal Hawaii address.
EIN (Employer Identification Number) From the IRS
- EIN (Employer Identification Number) From The IRS
- $0.00
Free directly from the IRS. Non-residents without a U.S. Social Security Number/ITIN cannot use the instant online EIN application and must apply by fax or mail, which takes materially longer.
Common Entity Types
- LLC (Limited Liability Company) — most common choice for solo founders/small businesses, formed by filing Articles of Organization (Form LLC-1)
- Corporation (C-Corp) — formed by filing Articles of Incorporation, more common if seeking outside investment
- Foreign qualification — if the company is already incorporated in another U.S. state or country and is simply expanding operations to Hawaii, a Certificate of Authority (Form FLLC-1 for LLCs or FC-1 for corporations) is filed instead of forming a new domestic entity
Step By Step Process
- 1. Check business name availability via the Hawaii Business Express portal (hbe.ehawaii.gov) or the DCCA business name database.
- 2. Appoint a Hawaii registered agent with a physical (non-P.O. box) Hawaii street address, available during business hours. Foreign founders without a Hawaii address typically hire a commercial registered agent service for this.
- 3. File the formation document with DCCA's Business Registration Division: Articles of Organization (Form LLC-1) for a new domestic LLC, Articles of Incorporation for a new domestic corporation, or the relevant Certificate of Authority form (FLLC-1 / FC-1) plus a Certificate of Good Standing from the home jurisdiction (dated within 60 days) if registering an existing foreign entity.
- 4. Obtain a free federal Employer Identification Number (EIN) from the IRS. This is required to open a U.S. business bank account and file taxes.
- 5. Register for a Hawaii General Excise Tax (GET) license with the Department of Taxation by filing Form BB-1 — this functions as Hawaii's de facto general business license and is required for almost any active business activity in the state.
- 6. Obtain any industry-specific state/county licenses or permits if applicable (e.g., for food service, contracting, etc.), separate from the entity registration itself.
- 7. File an Annual Report with DCCA every year going forward to keep the entity in good standing.
Currency Note
Oahu is in the United States; the local currency is the US Dollar (USD). Because the local currency and USD are identical here, the local-currency figure and the USD figure are the same number for every figure below.
Get Filing Obligations
- Periodic Returns
- Form G-45 (periodic return) filed monthly, quarterly, or semi-annually, with frequency assigned by the Department of Taxation based on estimated liability.
- Late Filing Penalty
- A 10 percent penalty on tax and surcharge due applies for late/unfiled periodic returns, on top of interest.
- Annual Reconciliation
- Form G-49 (annual return/reconciliation) is due after year-end, reconciling the periodic filings.
- Citation Late Penalty
- You will also be subject to a penalty of ten percent on the tax and surcharge due.
- Citation Efile Penalty
- A penalty of 2% of the total tax will be assessed if a taxpayer who is required to file electronically failed to do so.
- Electronic Filing Mandatory
- Yes
- Large Taxpayer Note
- Businesses whose combined annual GET, use, and county surcharge tax liability exceeds $100,000 must pay via a different (accelerated) payment schedule.
Federal Corporate Income Tax
- C Corp Federal Rate Percent
- 21
- LLC Default Treatment
- Single-member and multi-member LLCs are pass-through entities by default (disregarded entity or partnership taxation), so the entity itself pays no federal corporate income tax; profits pass to the owner(s).
- Note
- Federal tax is layered on top of any Hawaii state tax and applies regardless of city/state.
Get License And Registration
- Visa fee
- $20
one-time GET license registration fee
- Requirement
- Before earning any revenue in Hawaii, a business (including a sole proprietor/freelancer) must obtain a GET license by filing Form BB-1 (State of Hawaii Basic Business Application), either online via Hawaii Tax Online (hitax.hawaii.gov) or by mail to the Department of Taxation.
- Citation Form
- Complete the Form BB-1, State of Hawaii Basic Business Application, BB-1 Packet, and pay a one-time $20 registration fee.
- Processing Time
- Roughly 1–2 business days if registered online; about 5–7 days for a HI Tax ID if filed via Hawaii Tax Online by other means.
- No Hawaii Dcca Registration For Sole Proprietors
- A pure sole proprietorship generally does not need to register with the Hawaii Department of Commerce and Consumer Affairs (DCCA) or obtain an EIN, but STILL must obtain the GET license — the GET license is mandatory for essentially everyone doing business in the state, regardless of entity type.
Federal Foreign Ownership Obligations
- Penalty
- Missing or late Form 5472 filing carries a steep penalty.
- EIN Required
- The LLC/corporation needs a federal EIN before it can file required returns; an EIN can be obtained without a US Social Security Number or ITIN, though the online application isn't available in that case (mail/fax application is used instead).
- Citation 5472
- Foreign-owned single-member LLCs must file this form every year, even when they have no income.
- Citation Penalty
- The penalties for not filing are steep: $25,000 per year.
- Form 5472 Requirement
- A US LLC that is wholly or majority owned by a non-US person (a 'foreign-owned US disregarded entity') must file IRS Form 5472 together with a pro forma Form 1120 every year — even with zero income or activity — to report transactions between the LLC and its foreign owner.
- Personal Itin And 1040nr
- The foreign owner may separately need an ITIN and to file Form 1040-NR if the business has 'effectively connected income' to a US trade or business — this determination depends on individual facts and is best confirmed with a US international-tax accountant.
- Note
- These are IRS/federal requirements that apply nationwide to a non-US-person-owned US entity, on top of Hawaii's own state taxes — highly relevant for a non-resident foreigner incorporating on Oahu.
LLC And Corporation State Filing Obligations
- Annual Report
- Hawaii LLCs and corporations must file an annual report with the DCCA to remain in active status.
- Annual Report Fee
- $15
per year, LLC annual report to DCCA
- Citation Annual Report
- Limited Liability Companies (LLCs) are subject to an annual report fee of $15.
- Citation Foreign Entity
- If you want to do business in the Aloha State but your business was formed elsewhere, you'll need to pay Hawaii income tax, General Excise Tax, and all other applicable taxes on income generated in Hawaii.
- Foreign Entity Registration
- A company already formed in another US state (or country) that wants to operate on Oahu must register as a 'foreign' LLC/corporation with the Hawaii DCCA — this is a separate state-level 'foreign entity' concept unrelated to a founder's personal citizenship, and it still requires paying Hawaii income tax and GET on Hawaii-source income.
AI-generated estimateData refreshed July 2026
Sources cited for this category
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Data last updated July 2026 · Verify anything important.