Starting a service business in Vermont comes down to four things: picking a structure, registering with the state, getting licensed for your trade, and setting up a way to bill customers. Filing an LLC in VT costs $125, ongoing reporting is $35/yr, sales tax is 6% + local, and personal income tax runs 3.35%–8.75%. Below is the full sequence, the fees you should budget for, the licenses most trades need, and the deadlines that catch new Vermont owners off guard.
| Item | VT cost |
|---|---|
| LLC / entity filing (one-time) | $125 |
| Annual / periodic report | $35/yr |
| Federal EIN (IRS) | Free |
| Sales tax registration | Typically free |
| Trade / professional license | Varies by trade |
| Local business license | Set by city / county |
Fees change — confirm current amounts with the VT Secretary of State and the Vermont Department of Taxes.
Choose your structure and file with the VT Secretary of State ($125). Get your free EIN from the IRS the same day.
Register for Vermont sales tax with the Vermont Department of Taxes, then open a business bank account under the registered name.
Apply for your trade license and local business license. This is usually the longest step: Sales tax permit; Professional license.
Get general liability insurance (and workers' comp before your first hire), then set up estimates and invoicing so you can bill the day you're cleared to work.
LLC Filing Fee
$125
Annual Report
$35/yr
Sales Tax
6% + local
Income Tax
3.35%–8.75%
Choose business structure
File with VT Secretary of State
Get EIN
Register for state taxes
Get local permits
Open business bank account
Vermont has high income tax rates — up to 8.75%
Annual report is affordable at $35
Income tax ranges from 3.35% to 8.75% — higher than average.
Online LLC filings with the VT Secretary of State are typically processed in a few business days, and an EIN from the IRS is issued immediately online. Trade licensing and local permits usually take longest — plan on two to six weeks before you're fully cleared to work, depending on your trade.
No — you can operate as a sole proprietor in Vermont and still invoice customers legally. An LLC ($125 to file, $35/yr) separates your personal assets from business liability, which matters most once you're on customer property, hiring help, or signing contracts.
Vermont sales tax is 6% + local. Materials and goods are commonly taxable, while labor treatment depends on the type of work, so bill parts and labor as separate lines and register with the Vermont Department of Taxes before you start collecting.
Open a business bank account under the registered name, then invoice from a tool that applies VT tax per line item and accepts cards. Glo Invoice sends invoices by text with a one-tap pay link, and Tap to Pay lets you charge on site before you leave the job.