Delaware Business Guide
How to Start a Business in Delaware
Everything you need to form your Delaware LLC, corporation, or sole proprietorship, with exact fees, timelines, and step-by-step instructions.
Delaware is an attractive place to incorporate because of its combination of low formation costs and favorable tax structure. An LLC costs $110 to form and then owes a flat annual tax ($400 under the 2026 change, check corp.delaware.gov) with no annual report requirement. The state has no sales tax; instead, businesses pay a gross receipts tax set by license category (for example 0.3983% for services and 0.7468% for retailers), after a monthly exclusion of $100,000.
This guide covers every step of starting a business in Delaware, from choosing between an LLC and a corporation to obtaining your business license.
Choosing Your Delaware Business Structure
This is the first decision and it affects everything: taxes, liability, paperwork. If you are unsure, an LLC is the right default for most Delaware small businesses.
| Entity Type | Liability Protection | Taxation | Delaware Filing Fee | Annual Cost | Best For |
|---|---|---|---|---|---|
| LLC | Yes | Pass-through | $110 | Flat annual tax due each June 1 ($400; check corp.delaware.gov) | Most small businesses |
| Corporation | Yes | Double (C-Corp) or pass-through (S-Corp) | $109 | $50 annual report plus franchise tax (from $175) | Raising investment, stock options |
| Sole Proprietorship | No | Pass-through | $0 | $0 | Freelancers, side hustles |
| Partnership | No | Pass-through | $0 | $0 | 2+ owners (consider an LLC instead) |
8 Steps to Start Your Delaware Business
- 1
Choose your business structure
LLC, corporation, or sole proprietorship. Each has different costs, tax treatment, and liability protection.
- 2
Pick and reserve your business name
Search the Delaware Division of Corporations, Delaware Department of State database. Reserve for $75 (120 days).
- 3
Appoint a registered agent
Must have a physical Delaware street address. Can be yourself (free) or a service ($100 to $300 per year).
- 4
File your formation documents
Certificate of Formation of a Limited Liability Company (6 Del. C. Section 18-201) ($110) or Certificate of Incorporation (8 Del. C. Section 102) ($109) with the Delaware Division of Corporations, Delaware Department of State.
- 5
Get your EIN from the IRS
Free, online, takes about 5 minutes. Do not pay anyone for this.
- 6
Register for gross receipts tax if you sell goods
Through the Delaware Division of Revenue, Department of Finance. State sales tax rate: none.
- 7
Get required licenses and permits
Yes. Any person or entity conducting a trade or business in Delaware must obtain a Delaware business license from the Division of Revenue, applied for through Delaware One Stop...
- 8
Register for Delaware taxes
Personal income tax: Graduated from 2.2% to 5.55% on taxable income under $60,000, and 6.60% on taxable income of $60,000 or more.
How Much Does It Cost to Start a Business in Delaware?
| Item | Cost | Notes |
|---|---|---|
| LLC filing fee (Delaware Division of Corporations, Delaware Department of State) Required | $110 | The Division does not publish a standard turnaround for routine filings and states that processing times vary with the... |
| Corporation filing fee Required | $109 | If forming a corporation instead |
| Annual report | $0 | Not required in Delaware |
| Name reservation | $75 | 120 days |
| Registered agent service | $0 to $300/yr | Free if you serve as your own |
| EIN (IRS) Required | $0 | Always free |
| Business license | Varies | Yes. Any person or entity conducting a trade or business in Delaware must obtain a Delaware business license from the... |
| Operating agreement | $0 to $500+ | Free template or attorney-drafted |
| Realistic LLC total (year 1) | $185 and up |
Start a Specific Business in Delaware
How to Start a Courier and Delivery BusinessLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start a Catering BusinessLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start a Junk Removal BusinessLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start a Handyman BusinessLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start a Bakery BusinessLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start a Towing BusinessLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start a Coffee Shop BusinessLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start a Lawn Care BusinessLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start a Contractor Business: $75 Division of Revenue License, 0.6472% Gross Receipts Tax and the Labor Notice and Workers' Comp PrerequisitesLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start an Electrician Business: Board of Electrical Examiners Licenses, $203 Master Application and 6 Years Under a MasterLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start a Plumbing or HVAC Business: Master-Only Licensing, $173 Fee, $1,500 to $6,000 Fines and No Journeyman LicenseLicenses, permits, startup costs and first steps in DelawareRead the guide →How to Start a Hair Salon or Barber Shop: $142 Shop License, $128 Cosmetologist Fee and March 31, October 31 and June 30 RenewalsLicenses, permits, startup costs and first steps in DelawareRead the guide →
Starting a Business in Your Delaware City
Which Delaware Towns License Businesses: The State License Is Not the End, Wilmington, Middletown and Beach Towns Add Their OwnLocal licenses, permits and costsRead the guide →Delaware Rental and Short-Term Rental Licenses by Town: Beach-Town Fees, Local Rental Taxes and the State 4.5% STR Tax From 2025Local licenses, permits and costsRead the guide →Delaware Beach Towns Business Rules: Rehoboth, Lewes, Dewey, Bethany and Ocean View License Fees and Rental TaxesLocal licenses, permits and costsRead the guide →Delaware Downtown Development Districts: Rebates up to 20% of Qualified Real Property Investment and How to ApplyLocal licenses, permits and costsRead the guide →
Delaware Business Guides
Formation and Entity Types
- How to Start an LLC in Delaware
- How to Start a Corporation in Delaware
- Sole Proprietorship in Delaware
- Delaware Series LLC
- Register a Foreign LLC or Corporation in Delaware
- Delaware LLC for Non-Residents
- Revive a Delaware LLC or Corporation
- Delaware Division of Corporations Fees
- Delaware Public Benefit Corporation
- Delaware LP, LLP and LLLP
- Move Your Company to Delaware
Licenses, Permits and Registrations
- Delaware Business License
- Delaware Trade Name (DBA)
- Delaware Business Name Search
- How to Get an EIN in Delaware
- How to Get a Resale Certificate in Delaware
- Delaware Home-Based Business Laws
- Delaware Certificate of Good Standing
- Delaware Food Business Licenses
- Delaware Trade Licenses Guide
Taxes and Compliance
- Delaware Gross Receipts Tax
- Delaware Business Taxes Explained for New Owners
- Delaware Corporate Franchise Tax
- Delaware Hiring Guide
- Delaware Income Tax for Business Owners
- Delaware Lodging Tax 8% and Short-Term Rental Tax 4.5%
- Delaware Paid Family and Medical Leave
- Delaware Business Tax Calendar
- Delaware Lodging Tax 8% and Short-Term Rental Tax 4.5%
- Delaware LLC Annual Tax
- Delaware Has No Sales Tax
Costs, Money and Services
Why Start a Business in Delaware?
- More than 2,000,000 business entities are registered in Delaware, and more than 66% of Fortune 500 companies use it as their legal home.
- Delaware has no state sales tax; businesses instead pay a gross receipts tax on the seller, at rates set by license category (for example 0.3983% for services and 0.7468% for retailers), after a monthly exclusion of $100,000 for monthly filers.
- An LLC costs $110 to form on the state fee schedule and then owes a flat annual tax due each June 1 ($400 under the 2026 change, first payment due June 1, 2027), with no annual report to file.
- A corporation costs $109 minimum to incorporate, then pays a $50 annual report fee plus franchise tax starting at $175 under the authorized shares method, due March 1.
- Personal income tax is graduated from 2.2% to a top rate of 6.60% at $60,000 of taxable income, and corporate income tax is 8.7% on income apportioned to Delaware.
Delaware Business Resources
Delaware Division of Corporations, Delaware Department of StateEntity filing, name search, online filingcorp.delaware.gov →Delaware Division of Revenue, Department of FinanceBusiness licenses, gross receipts tax, trade namesrevenue.delaware.gov →Delaware Small Business Development Center (Delaware SBDC)Free business counseling and trainingdelawaresbdc.org →SBA Delaware District OfficeFederal loans, programs, and mentoringwww.sba.gov →
Frequently Asked Questions
- How long does it take to form an LLC in Delaware?
- The Division of Corporations does not publish a standard processing time, and turnaround varies with filing volume. Same day service is available for $100, and expedited one hour service for $1,000.
- What does it cost to start an LLC in Delaware in year one?
- An LLC formation costs $110, and you must obtain a business license, which costs $75 per year for most business types, for a total of $185 in year one startup costs. The flat annual LLC tax ($400 under the 2026 change; check corp.delaware.gov) is first due June 1 of the following year.
- Can a non-resident form a Delaware LLC?
- Yes, non-residents can form a Delaware LLC. The entire formation process is conducted online through the eCorp Document Upload Service, and Delaware has no residency requirement for incorporation.
- What is the cheapest way to start a business in Delaware?
- An LLC is the cheapest way to start a business in Delaware. Formation costs $110 and a required business license costs $75, totaling $185 in startup costs, with the flat annual LLC tax ($400 under the 2026 change; check corp.delaware.gov) first due June 1 of the following year.
- Is an operating agreement required for a Delaware LLC?
- Delaware does not legally require an operating agreement for an LLC. However, one is recommended to establish each member's ownership percentage, management rights, and how profits will be distributed.