Utah has low, simple business taxes. C corporations pay a flat 4.45%, individuals and pass-through owners pay a flat 4.45% and LLC fees are among the lowest in the country, at $59 to form and $18 a year. The state has cut income taxes repeatedly in recent years and consistently ranks near the top of business climate surveys.
This guide covers Utah's business taxes for 2026, with worked examples and comparisons with its neighbors.
Utah business taxes at a glance
A Utah C corporation pays a flat 4.45% on profit, with a $100 minimum. Pass-through owners pay a flat 4.45% at the state level, minus a taxpayer credit that phases out at higher incomes. Customers pay a combined sales tax of at least 6.1%, averaging about 7.42%. Businesses pay property tax on real estate and on equipment above $15,000. LLC fees are very low. Utah has no franchise tax and no gross receipts tax.
Corporate income tax
| Item | 2026 |
|---|---|
| Corporate income tax rate | 4.45% |
| Minimum tax | $100 |
- Rate history: 4.95% through 2021, 4.85% in 2022, 4.65% in 2023, 4.55% in 2024, 4.5% in 2025 and 4.45% from 2026 under SB 60.
- Apportionment: Single sales factor for most businesses since 2020.
- Combined reporting: Required for unitary groups, on a water's-edge basis.
- Credits: Research credits, Economic Development Tax Increment Financing (EDTIF) and the targeted business tax credit.
- Returns: Form TC-20 is due on the 15th day of the fourth month after year-end.
Personal income tax and pass-through owners
| Item | 2026 |
|---|---|
| Personal income tax rate | 4.45% flat |
| Taxpayer credit | 6% of federal deductions, phased out at higher incomes |
- LLC owners, partners and sole proprietors pay 4.45% on profit.
- S corporation shareholders pay on their share.
- PTE election: Entity-level tax at 4.45%, deductible federally.
- Nonresident withholding: Pass-through entities withhold for nonresident owners.
Sales and use tax
| Component | Rate |
|---|---|
| State sales tax | 4.85% |
| Statewide local and county | 1.25% |
| Minimum combined rate | 6.1% |
| Average combined rate | About 7.42% |
| Groceries | 3% combined |
- Services: Most services are not taxed, though some, such as repairs and admissions, are.
- Manufacturing equipment is exempt.
- Remote sellers with more than $100,000 of Utah sales must collect.
Payroll and property taxes
- Unemployment insurance: Employers pay on a wage base near $50,000, among the higher bases nationally, with low rates.
- Property tax: Commercial property is assessed at full value with moderate rates. Business personal property is taxed above a $15,000 exemption.
Forming a business in Utah: fees and ongoing costs
| Item | LLC | Corporation |
|---|---|---|
| Formation filing fee | $59 | $59 |
| Annual renewal | $18 | $18 |
| Minimum tax | None | $100 |
| Registered agent | Required | Required |
Worked example: $500,000 of profit
| Step | Amount |
|---|---|
| Taxable income | $500,000 |
| Utah corporate tax at 4.45% | $22,250 |
| Federal tax at 21% on $477,750 | $100,328 |
| Total income tax | $122,578 (24.5%) |
For a single LLC owner with $150,000 of Utah taxable income, state tax is about $6,675 before the taxpayer credit. At $75,000 it is about $3,338.
How Utah compares with its neighbors
Utah's rates are below Idaho's and similar to Colorado's. Wyoming and Nevada have no income taxes, though Nevada has a Commerce Tax on gross receipts above $4 million. Arizona's flat 2.5% personal rate is lower than Utah's, but its corporate rate is higher.
Choosing an entity in Utah
- LLC: $59 to form and $18 a year; owners pay 4.45%.
- S corporation: Same 4.45% for owners, with federal payroll tax savings.
- C corporation: 4.45% plus 21% federally.
Because personal and corporate rates are nearly identical, entity choice in Utah is driven mainly by federal tax considerations.
Utah taxes by business type
Technology companies. The Silicon Slopes area between Salt Lake City and Provo has attracted software and fintech companies. Single sales factor apportionment keeps the Utah tax base low for companies selling nationally.
Outdoor and tourism businesses. Ski resorts, national park outfitters and hotels collect sales tax plus transient room and resort community taxes, which can push lodging rates above 12%.
Manufacturers. Manufacturing equipment and many inputs are exempt from sales tax, and EDTIF incentives can refund a share of new state taxes for expanding companies.
Small service businesses. Very low formation and renewal fees and a flat income tax make Utah inexpensive for freelancers and consultants.
Doing business across Utah
Most of Utah's population lives along the Wasatch Front, from Ogden through Salt Lake City to Provo. Salt Lake City is the regional hub for finance, health care and the airport, while Lehi and Provo are centers for technology. St. George in the southwest is one of the fastest-growing metros in the country, with tourism and retirees. Park City is a major ski destination with higher local taxes on lodging.
Tax planning tips for Utah businesses
Elect the PTE tax. For profitable pass-through owners, the election makes Utah tax deductible federally.
Apply for EDTIF before expanding. Utah's main incentive refunds a portion of new state taxes for qualifying projects, but approval is required before you commit.
Use the personal property exemption. Small businesses with equipment worth $15,000 or less don't owe personal property tax, but must still file if asked by the county assessor.
Who pays the most in Utah
Utah's tax burden is spread fairly evenly. Because the income tax is flat, high earners pay the same 4.45% rate as middle-income owners, but the taxpayer credit phases out as income rises, so their effective rate is higher. Households pay sales tax on groceries, although at a reduced rate, which weighs more heavily on lower incomes. Businesses with substantial equipment pay personal property tax above the $15,000 exemption. Resort towns impose additional lodging and resort taxes, which visitors largely pay.
How Utah's income tax cuts add up
Utah has cut its income tax rate five times since 2022, from 4.95% to 4.45% for both corporations and individuals, most recently under SB 60 in 2026. A Constitutional amendment approved in 2024 loosened the requirement that income tax revenue fund only education, giving lawmakers more flexibility to continue cuts. For a corporation earning $1 million, the move from 4.95% to 4.45% saves $5,000 a year. For an owner with $150,000 of income, the cut from 4.95% to 4.45% saves about $750. Further reductions depend on revenue growth, and lawmakers have discussed eliminating the state's portion of the grocery tax as an alternative.
Recent changes for 2025 and 2026
- Corporate and personal rates both cut to 4.45% under SB 60, retroactive to January 1, 2026.
- Taxpayer credit phase-out thresholds updated.
- Grocery tax reduction discussed in recent sessions.
Is Utah a good state for business?
Advantages
- Low, flat corporate and personal income taxes
- Among the lowest LLC fees in the country
- Fast-growing, young workforce
- Strong technology and outdoor recreation sectors
Drawbacks
- Sales tax on groceries
- Business personal property tax above $15,000
- Neighbors Wyoming and Nevada have no income tax
- Water and housing pressures from rapid growth
Compliance checklist
- File a Certificate of Organization or Articles of Incorporation with the Division of Corporations.
- Register with the State Tax Commission for sales tax, withholding and income tax.
- Register with the Department of Workforce Services for unemployment insurance if you hire.
- File the annual renewal each year.
- File Form TC-20, TC-20S or TC-65 each year.
Compare Utah with its neighbors below or estimate your taxes in the United States calculator. See LLC taxes for more.