How to Start a Business in Hawaii Checklist:
Download this free business checklist in PDF format.
Download NowHow to Start a Business in Hawaii:
Hawaii offers business owners a wide range of business formation types, but there are a number of steps to take to register your business in the state. Follow our step-by-step guide to ensure you have all the legal requirements covered before you start operating your business in the state of Hawaii.
Form your business.
Review Hawaii formation options.
Hawaii offers 10 ways of forming your business, which we'll cover in detail below. Review these closely and pick the one that fits your business best.
Name your business.
Once you have chosen a name for your business, you will need to check that it has not been trademarked or registered by another business in Hawaii. You can do this by conducting a search on the United States Patent and Trademark Office site as well as the Hawaii government website.
If you would like to reserve your business name, you can do so by filing a name reservation online through the state website. Names are reserved for 120 days. You might also want to file a trade name or trademark with the state.
If you need help finding a business name, be sure to check out NameSnack's free business name generator.
To reserve a business name, create an account or sign in to the Hawaii Business Express portal.
Fill in the application form.
Pay the filing fee.
Get an employer identification number.
Nearly all businesses will need to register for federal taxes by applying for an employer identification number.
Register your business in Hawaii.
Before registering your business, you will first have to obtain a Certificate of Good Standing and appoint a registered agent who resides in Hawaii.
Thereafter, you are required to register a new business with the Department of Commerce and Consumer Affairs (DCCA). You can do this quickly and easily via the government's Hawaii Business Express portal.
Create an account or sign in.
Click "Get Started" to register a new business.
Complete the formation documents.
Submit your documents and pay the filing fee.
You will receive a receipt confirming your submission.
Obtain necessary permits and licenses.
Hawaii does not have a statewide business license. However, you may need to acquire a license/permit depending on the nature of your business and location. For example, the Department of Agriculture issues permits for importing plants, animals, and microorganisms and exporting plants and livestock.
With regard to occupational licenses, you'll want to take a look at the Department of Commerce and Consumer Affairs' Professional & Vocational Licensing Division, which issues licenses for 52 different professions and vocations.
Here are a few common professions that require licenses in Hawaii:
All Hawaii businesses are required to apply for applicable permits and licenses through the Department of Taxation, which you can do when you register your business entity through Hawaii Business Express.
Be sure to contact your local county office to determine whether you need a local license or permit to operate in your area.
Register your business for taxes.
Register with the Hawaii Department of Taxation.
By law, any business in Hawaii must apply for a Hawaii tax ID number with the Department of Taxation (DOTAX) in order to sell goods or services. You can do so through the Hawaii Business Express portal. Refer to the Department of Taxation for more information.
Go to Hawaii Business Express.
Input your business information.
Pay the applicable license fees.
Obtain a General Excise Tax (GET) license.
In place of sales tax, Hawaii has a general excise tax which the state imposes on all business activities within the state, including wholesaling, retailing, farming, services, construction contracting, rental of personal or real property, business interest income, and royalties.
To apply for a GET license, fill out and submit Form BB-1 along with the $20.00 license fee.
The form can be mailed or handed in in-person.
Register for income tax.
All businesses, except partnerships, are required to file an annual income tax return. Partnerships are required to file an annual information return to report the income, deductions, gains, and losses from its operations. To register for partnership/corporate/employer's withholding income taxes, you will need to fill out and submit the applicable form for your business.
Register for Unemployment Insurance (UI) tax.
If you have employees in Hawaii, you are required to pay unemployment insurance taxes on their wages. Tax reports are due quarterly even if you did not pay any employees during that quarter. You can file your UI tax forms via the Unemployment Insurance Filing System of the Department of Labor & Industrial Relations (DLIR).
Additional business taxes include those for transient accommodations, the rental of motor vehicles, the sale of tobacco and liquor, and the manufacturing and sale of fuel.
Go to the Unemployment Insurance Filing System.
Create an account.
Select "File a Claim Online" and follow the prompts.
Hire employees and report them to the state.
Report to the Child Support Enforcement Agency.
When you hire or rehire an employee in Hawaii, you have 20 days to report them to the Hawaii Child Support Enforcement Agency (CSEA). Before they start working for you, have them fill in an IRS W-4 form for tax withholding processing. Print out the forms and deliver them to the Child Support Enforcement Agency. There is no online option at this time.
Obtain Workers' Compensation Insurance.
To protect yourself, your employees, and your business assets, you'll need to obtain workers' compensation insurance, irrespective of your employees being full-time, part-time, or temporary workers. Employers are encouraged to purchase insurance from insurance carriers authorized to transact in Hawaii.
Display mandatory posters at your place of business.
The Department Of Labor and Industrial Relations requires all employers to prominently display mandatory labor law posters in the workplace.
Hawaii Business Filing Fees:
Filing Type | Cost |
|---|---|
Name Reservation | $10.00 |
Corporation | $50.00 |
Limited Liability Company | $50.00 |
General Partnership | $15.00 |
Limited Partnership | $25.00 |
Limited Liability Partnership | $25.00 |
Consumer Cooperative (with capital stock) | $50.00 |
Consumer Cooperative (without capital stock) | $25.00 |
Nonprofit Corporation, Corporation Sole, Sustainable Business Corporation | $25.00 |
Good Standing Certificate | $5.00 |
Annual Report/Statment | $5.00 – $15.00 |
Trademark | $50.00 |
How to Start a Business in the Virgin Islands
Hawaii Business Formation Options:
1. Sole Proprietorship.
A Sole Proprietorship is the simplest business structure and the least expensive to start. The business is owned and operated by one individual, who is personally liable for all business debts.
2. Corporation.
A Corporation is a formal business structure owned by one or more shareholders, which makes it easier to raise capital. In Hawaii, the shareholders' liability is limited to the amount they invest in the company. Corporations are typically more difficult and expensive to start. They are divided into S-Corporations and C-Corporations.
3. Limited Liability Company.
A Limited Liability Company (LLC) is the most common business structure. It separates the owner/s and the company from a business and liability perspective. An LLC is the best option for a small business as it is flexible, easy to set up, and requires minimal paperwork.
4. General Partnership.
A General Partnership is run by two or more partners who manage the day-to-day business operations and are personally liable for all of the company's debts. This is the simplest form of a partnership with minimal paperwork.
5. Limited Partnership.
A Limited Partnership (LP) is similar to a General Partnership except that limited partners do not manage the business and are only liable for the amount they invest in the company.
6. Limited Liability Partnership.
A Limited Liability Partnership (LLP) is similar to a General Partnership but each partner is protected from other partners' debts and obligations.
7. Nonprofit Corporation.
A nonprofit corporation has no owners. Instead, it is governed by a board of directors. Nonprofit corporations are funded by grants, public donations, and fees for services. All funds are retained by the organization for the advancement of a social cause.
8. Cooperative.
A cooperative is owned and managed by the workers of a business. The members share the decision-making and profits of the business. The benefits of this type of business structure are that it provides better wages, offers extensive training for employees, as well as opportunities for participation in management.
9. Corporation Sole.
A corporation sole is a nonprofit organization operated by a chief priest, presiding elder, or other presiding officer of any church for the purposes of administering and managing the affairs, property, and revenues of a church.
10. Sustainable Business Corporation.
Also known as a benefit corporation, sustainable business corporations are run by one or more owners/shareholders and have a board of directors. This type of business structure differs from regular corporations in that they consider their impact on the environment and society in addition to seeking profit. Shareholders have limited liability for the debts of the business.
