BUSINESS TAX IN SAVANNAH OR HINESVILLE | THE BASICS
Feb. 10, 2016
Savannah, founded in 1733 on the Savannah River, is the seat of Chatham County and the oldest city of the State of Georgia. Thousands of businesses large and small operate within the city limits. Savannah is business-friendly, welcomes new enterprises, and wants all of them to succeed and prosper.
New Businesses in Savannah
To help new businesses get established and attract patrons, the city publishes a how-to guide to basic business startup steps and points good to know about local business taxes and commercial regulations. The first step is to contact the Business Approval Coordinator in the municipal Development Services Department to confirm that the proposed location for the new business is within a proper zone. The business owner must complete a business approval application form and submit it to the Business Approval Coordinator for review.
Next, any business that sells goods needs a Georgia State Tax ID number available from the Georgia Department of Revenue. Then, if the business employs workers, it must have a federal employee identification number from theInternal Revenue Service.
After this, if the business prepares food for sale, it must have a food service permit from the Chatham County Health Department. If it sells pre-packaged food, it must contact the Georgia Department of Agriculture.
If the Georgia Secretary of State regulates its activity, the business must fulfill all licensing requirements and obtain proof of current licensure. The business also must register with the Secretary of State to operate as a corporation or a limited-liability corporation.
Having completed all preliminary requirements and obtained all necessary documentation, the business must complete its New Business Tax Return Form. When submitting the form to the Business and Alcohol Regulations Division, the business must submit all required documents as well.
The Savannah Business Tax
Under Official Code of Georgia Annotated Title 48 Chapter 13 Sections 3 through 26 (OCGA 48-13-3 through 48-13-26) and under Savannah City Revenue Ordinance Article Y (Article Y), every business exerting "substantial efforts" [i]within the city must pay an annual business tax based on "gross receipts . . . and nation-wide profitability ratios." [ii]The city issues a business tax schedule specifying annual taxes ranging from $85 to $21,674 due on 21 gross receipt/profitability ratio brackets.
Specified professional businesses may elect to pay a $400 flat fee per practitioner rather than report and pay tax on gross receipts. This provision applies to "each attorney; physician; osteopath; chiropractor; podiatrist; dentist; optometrist; psychologist; veterinarian; landscape architect; land surveyor; physiotherapist; public accountant; embalmer; funeral director; civil, mechanical, hydraulic, or electrical engineer; architect; marriage and family therapist, social worker, and professional counselor practicing such profession, whether individually or as a member or employee of a firm, partnership, or corporation." [iii]
There are painful penalties for delinquencies and violations of the business tax in Savannah or Hinesville. For registration, filing of the business tax return, or payment of the business tax 90 days past due, there is a 10-percent delinquency penalty on the amount overdue and interest "at the rate of 1.5% per month." [iv] Any tax delinquent who transacts or offers to transact business within the city shall, "upon conviction in the Recorder's Court of Chatham County, be subject to the general penalty as provided by the Savannah Code, Section 1-1013." [v]
Consult an Experienced Savannah Business Tax Attorney
Savannah is business-friendly yet even here there are business tax in Savannah or Hinesville pitfalls for new entrepreneurs to avoid. To be safe and not sorry, invest a modest sum in a legal consultation and, if it proves to be time well spent, consider engaging the attorney for help with future business problems, which are inevitable and for which there is no substitute for the advice and advocacy of professional counsel. For help with business tax in Savannah or Hinesville, contact experienced attorney, John E. Pytte.
[i] OCGA 48-13-7(b)(1).
[ii] OCGA 48-13-7(d).
[iii] Article Y Section (§) 4(C), citing OCGA 48-13-9(c)(1) through (18).
[iv] Article Y § 11.
[v] Article Y § 12(A). The general penalty may be "a fine not to exceed $1,000.00 or imprisonment for not more than 30 days."