In response to Senate Bill 5814, B&O tax classifications for several businesses previously classified as ‘service and other’ will now report as ‘retailing’ beginning January 1, 2026. These services and businesses include: Advertising services; Live presentations; Information technology services; Custom website development services; Investigation, security, and armored car services; Temporary staffing services; Sales of custom software and customization of prewritten software.
The Renton B&O tax is a gross receipts tax. It is measured on the value of products, gross proceeds of sales, or gross income businesses earn.
There are no deductions for labor, materials, rent, or other costs of doing business. If you do business in Renton, you must have a Renton business license and file a B&O tax return.
Businesses are subject to the B&O tax if the annual taxable revenue is above $500,000.
The Renton B&O tax is not the same as the Washington state B&O tax. Renton taxes must be filed separately from state taxes.
For more information on the Washington B&O tax, visit Washington State Department of Revenue.
Exemptions
The City of Renton has adopted many exemptions for B & O taxes. These exemptions may differ from other Washington cities and the Washington State Department of Revenue.
The following is a list of available exemptions:
- Adult family homes
- Day care provided by churches
- Childcare resource and referral services by nonprofit organizations
- Nonprofit Credit and Debt Services Organizations
- Certain fraternal and beneficiary organizations
- Certain corporations furnishing aid and relief
- Operation of sheltered workshops
- Investments - dividends from subsidiary corporations (except financial businesses)
- Gross Receipts Taxed under another Renton Municipal Code section
- Credit unions
- International banking facilities
- Insurance businesses
- Farmers
- Athletic exhibitions
- Racing
- Ride sharing
- Employees
- Sale of real estate
- Mortgage brokers’ third-party provider services trust accounts
- Motor vehicle fuel
- Liquor sale and distribution
- Casual or isolated sales
- Accommodation sales
- Real estate brokers
- Taxes collected as trust funds
- Health maintenance organizations
For more information on eligible tax exemptions, refer to Renton Municipal Code section 5-25-10.
Deductions
The City of Renton has adopted many deductions for B & O taxes. These deductions may differ from other Washington cities and the Washington State Department of Revenue.
The following is a list of available deductions:
- Membership fees and certain fees by non-profit youth organizations
- Fees, dues, charges for non-profit organizations
- Certain income from business activities of non-profit artistic and cultural organizations
- Value of articles for use in displaying art objects or presenting artistic or cultural exhibitions, performances, or programs by non-profit artistic and cultural organizations
- Daycare activities provided by non-profit organizations
- Interest on loans to farmers and ranchers, producers or harvesters of aquatic products
- Receipts from the sale of tangible personal property delivered outside of the State
- Cash discounts taken by purchaser
- Credit losses of accrual base taxpayers
- Repair, maintenance, replacement, etc. of residential structures and commonly held property for eligible organizations
- Certain advertising fees for radio and television broadcasting
- Any activity which the city is prohibited from taxing under the Constitution or laws of the State of Washington or the United States of America
- Receipts from the sale of tangible personal property and retail services delivered outside of the city but within Washington
- Certain professional employer services
- Compensation received from public entities for the support of health or social welfare services
For more information on eligible tax deductions, refer to Renton Municipal Code section 5-25-11.
Tax Credits
The City of Renton offers two B & O tax credits - the Multiple Activities Tax Credit and the New Business Tax Credit.
Multiple Activities Tax Credit (MATC)
The Multiple Activities Tax Credit is divided into two components:
- External Credits - persons that engage in business activities that take place in one or more cities with an eligible gross receipts tax.
- Internal Credits - credit for the sale of products within the same city that they extract or manufacture, credit for manufacturing products within the same city using ingredients they extracted, and credit for the sale of products within the same city they printed or published and printed.
For more information on MATC, refer to Renton Municipal Code sections 5-25-5 and 5-25-6.
New Business Tax Credit
A $1,000 credit per full-time equivalent (FTE) may be credited against the B&O tax due for new businesses bringing 50 or more new FTE into the city for the first three consecutive years (12 consecutive quarters).
Businesses must meet the following criteria:
- Has not engaged in business within Renton in the 10 years prior to the application of the credit;
- Employs 50 or more full-time equivalents (FTE) within Renton. An FTE is defined as 1,920 worker hours per calendar year;
- The total credit cannot exceed the total tax due.
For more information on the New Business Tax Credit, refer to Renton Municipal Code section 5-25-12.
Annual Tax Cap
The B&O Tax imposed shall not exceed more than the set cap limit (per business) which shall be adjusted each January to reflect the inflation adjustment. For 2025, the maximum tax is $12,000,000.00.
** Once a taxpayer has paid $12 million dollars ($12,000,000) in taxes imposed in the given year, the rates specified in RMC 5-25-4.A shall then be discounted by 75% for remaining gross proceeds of sale, gross income of business, or value of products, including by-products, as the case may be.
Reporting & Due Dates
There are two reporting frequencies for B&O tax - Annual and Quarterly:
Annual Filers
Businesses earning revenue less than $1 million per year will generally be put on an annual filing status. The B&O filing and reporting due date for annual filers aligns with their business license expiration date. If at the end of the reporting period the threshold has not been met, no B&O Tax will be due; however, returns are still required to be filed. See reporting dates below:
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Tax Year
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Filing Due Date
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Reporting Period
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2020-current
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April 30
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January 1 - December 31
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2016-2019
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January 31
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January 1 - December 31
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Quarterly Filers
Businesses earning revenue over $1 million per year will generally be required to report and pay B&O taxes quarterly. Quarterly returns and payment are due on or before the end of the month immediately following the end of the tax reporting quarter. See reporting dates below:
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Reporting Period
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Return and Payment Due
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January 1 - March 31
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April 30
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April 1 - June 30
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July 31
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July 1 - September 30
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October 31
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October 1 - December 31
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January 31
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