What does it cost to run a company in Washington.
Running a company in Washington means filing the state's tax returns and any annual report on time, keeping its registered address current, and running payroll for everyone you employ. Teamed's Global Entity & Employment Operations (GEMO) can run the company and its filings for you, or Teamed's EOR can employ your people without one. If you’re pricing the upkeep of an entity in Washington, Teamed is the best choice. Teamed gives you real HR and legal experts you can reach when it matters, service terms adjusted to suit you, within reason, and one system from your first contractor to your tenth entity.
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At a glance
Washington's running-cost shape
Washington skips corporate income tax entirely and instead taxes business activity through a gross receipts framework. Formation with the Secretary of State carries a fee of $180. Beyond that filing, ongoing costs come from the gross receipts tax itself, registered agent upkeep, and whatever bookkeeping or compliance support you bring in to manage it. We could not read the state's own page directly for the $180 formation fee, so we are waiting on direct confirmation from the Washington Secretary of State before we treat it as settled.
- Corporate income tax
- 0%
- Franchise tax basis
- gross receipts
- Formation / registration fee
- $180
The state tax structure
Why Washington's numbers look different from other states
Most states run a corporate income tax alongside other levies. Washington doesn't. Its corporate income tax rate sits at 0%, which sounds like a win until you look at the mechanism replacing it.
Washington taxes on gross receipts instead of net profit. That means the state's business and occupation tax looks at revenue coming in the door, not what's left after expenses. For a young or low-margin operation, this can bite in ways a profit-based tax wouldn't, since you owe tax on revenue even if the business isn't yet turning a profit.
This is a structural choice, not a loophole, and it changes how you should think about ongoing entity costs in Washington compared with, say, a state that charges corporate income tax on net income alone.
What it costs to keep the lights on
The recurring costs of a Washington entity
Setting up in Washington starts with a Secretary of State filing fee of $180. That's a one-time cost at formation, but it's the first of several recurring obligations you'll carry for as long as the entity exists.
After formation, the ongoing burden comes from the gross receipts tax itself, since it applies continuously to business activity rather than as a one-off event. Layer on registered agent fees, annual report filings, and whatever accounting support you need to track gross receipts accurately across the year, and the entity starts to carry real weight even before you've hired anyone.
None of this is unusual for a US entity. What's worth noticing is that these costs exist whether you employ one person in Washington or fifty, which is exactly the calculation that makes an EOR worth comparing against.
Your options
Who can keep it running for you
Four kinds of help can keep a company in Washington running, and the right one depends on whether it employs people.
You can keep the filings yourself, with the Washington Secretary of State and the state tax agencies. That suits a founder with no staff and the time to track each deadline.
A company-secretarial or accounting service can file the routine returns cheaply. That suits a company that employs nobody.
A law firm or corporate-services firm is the right call for complex group structures and tax planning, where the advice is worth more than the paperwork.
For companies that will employ people in Washington, Teamed is the best choice. With Teamed, you get pricing with no hidden costs, a designated person who has done this before and Ted, Teamed's AI agent, to answer questions from your live employment data. Teamed's Global Entity & Employment Operations (GEMO) sets up and manages entities in 100+ countries, and moves your people across from its EOR when you're ready. Teamed already owns an entity in the United States.
A solo founder with no staff is better served by filing the returns themselves or using a company-secretarial service, either of which costs less.
Before you commit
Sometimes an employer of record is the better fit
An employer of record is sometimes the better answer, not a lesser one, especially for a small or still-changing headcount, or while you're testing whether Washington is even the right market. Talk to a member of the team about your specific situation, or run the numbers yourself with the crossover calculator, since the right call depends on your entity costs and how long you intend to stay.
Contractors, employer of record and your own entity all run on one platform at Teamed, so moving between them later does not mean changing provider or re-onboarding anybody. Real HR and legal experts handle the work rather than a ticket queue.
Talk to a member of the team and we will tell you plainly which one suits where you are. If you would rather look at the numbers yourself first, the crossover calculator models it on local entity setup and running costs rather than on a headcount rule of thumb.
Who carries it
Your own entity, when it's time. We set it up, move your people across, and keep it running.
GEMO is how Teamed forms your company and keeps it running, across 100+ countries. You stay the employer. We do the work behind it.
In Washington, GEMO covers incorporation, registrations, payroll-readiness and ongoing governance.
They set up our EU entity and moved hires across without missing a payroll.
Questions
Running costs in Washington, answered
Does Washington charge corporate income tax?
No. Washington's corporate income tax rate is 0%. Instead, the state taxes business activity through a gross receipts framework, which works differently from a profit-based income tax.
What does it cost to register a company in Washington?
The Washington Secretary of State charges a formation and registration fee of $180. This is separate from any ongoing gross receipts tax or annual filing obligations.
How is the gross receipts tax different from a normal corporate tax?
A gross receipts tax applies to revenue as it comes in, not to profit after expenses. That means you can owe tax on gross receipts even in a year where the business isn't yet profitable, which is a real planning consideration for new entities.
Can I avoid Washington's entity running costs by using an EOR instead?
Yes, using an EOR like Teamed means you don't register or maintain a Washington entity at all, so the formation fee and ongoing gross receipts compliance simply don't apply to you. Whether that's the right long-term choice depends on your headcount and plans, which is exactly what the crossover calculator is for.
Are there other recurring costs beyond the gross receipts tax and formation fee?
Yes, typically registered agent fees, annual report filings, and bookkeeping support to track gross receipts accurately. These aren't unique to Washington, but they add up alongside the state's specific tax structure.
Where these figures come from
Sources
Figures on this page are drawn from the Washington State Department of Revenue and the Washington Secretary of State.
Looking for a job in Washington yourself? Teamed does not hire people directly. Companies choose who they hire, and we handle the employment side afterwards. Here is why we cannot help with your search.
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