Utah is a popular place to live, discover your dream job, or run and build your own business. If you want to start your own company, registering a business in the Beehive State is a fairly straightforward process due to the state’s efficient and consistent support for small businesses just starting out.
There are a number of different development centers in Utah with the sole focus of helping entrepreneurs and those with existing small businesses develop and maintain their position within their community. They also help companies expand throughout the state of Utah, on a national basis throughout the U.S., and even on an international level.
Utah’s constant support for small businesses is evident in its approach to encouraging new businesses to register in the state. With access to many different and free development plans that are executed by professional volunteers (with the sole goal of bringing value to your business and supporting it), low income tax rates, affordable homes, a broad choice of commercial space, low Utah Division of Corporations and Commercial Code registration fees, and efficient filing times, it comes as little surprise to see so many people deciding to call Utah their new place of business!
The Beehive State’s economy has been ranked the 4th healthiest in the nation! Not only is Utah incredibly pro-business, but it also boasts some of the most amazing attractions, natural landscapes, mountain ranges for skiing and hiking, and the iconic Salt Lake City.
How to Register a Business Name in Utah – 7 Easy Steps
The Utah Division of Corporations and Commercial Code makes it reasonably easy to register your business name. There are three ways you can do this:
- 1. Do it yourself directly on their website.
- 2. Pay a document filing company that can register everything online for you – there is a modest fee for this but it saves a lot of time and hassle and ensures your paperwork is filed correctly.
- 3. Hire an attorney or accountant to file and register your new company – there are higher fees associated with this.
Step 1 – Determine your registered name
Firstly, you must determine that your business name is unique and not being used by someone else. A business registration company can do this research on your behalf or alternatively, you can search directly on the Utah Division of Corporations and Commercial Code website.
Once you have established your name is available you can register a business name in Utah directly on their website if you are comfortable with the process. Or, if you want a company to do this for you that specializes in this, you can use an online registration service to do it.
These document filing companies usually offer a free registered agent service for one year with most of their packages which is often a necessity for new businesses and those being registered by foreigners with no U.S. address.
Before doing any of this, you must decide on the right structure.
Step 2 – Choose the right entity
You need to choose the right type of business to register and the most common options are a limited liability company (LLC) or an incorporated company (Inc.). If you are keeping things really small and simple (one or two people), then you may consider a sole proprietorship or a general partnership.
Even if you plan to be a solopreneur, it is usually more beneficial for you to register a Utah LLC to make sure, as the owner, you have limited liability under this structure, and so you can benefit from the pass-through tax advantages.
Here is a quick rundown of the various options and what they might mean to you:
- Limited Liability Company: A Utah LLC is often the best route for most entrepreneurs because the structure comes with personal asset protection, no double taxation, is fairly easy to maintain, and does not have high registration or annual renewal costs. Through LLC formation you have better tax flexibility and income can be taxed as a pass-through entity like a sole proprietor or partnership, or as a corporation.
- Incorporated Company: A Utah Corporation offers personal asset protection and your company can own property, vehicles, incur liabilities, and is responsible for its own debts and can conduct business without the owners risking their personal assets such as their homes, cars, personal savings, retirement, etc. On the flip side, owners of sole proprietorships or partnerships face unlimited liability for both business and personal assets.
Step 3 – Make sure your name is not being used by another company
This may seem obvious, but if you check the Utah Division of Corporations and Commercial Code website and see that your chosen business name is available, that is all well and good, but that doesn’t mean someone else is not using that same or similar name, particularly in another state.
Many people register an “official business entity name” and trade under a different name. This is called a Utah dba, or “doing business as” name or assumed trading name, and needs a separate DBA certificate.
You will want to do a Google search for your official name and your desired trading name (if different) to make sure no one else is using this name. Most importantly, you will want to make sure you can get an easy-to-remember website domain name that is not being used by someone else.
Having an awesome name or trading name for your business can be crucial to your success, so making sure the domain name is available too, and registering it right away, is equally as important.
Finally, if you go to the Utah Division of Corporations and Commercial Code website and discover that someone else has registered the name you would like, you can search for variations of that name by adding a word before it or after it, or using some other variations until you find a name that is available and acceptable for you.
Step 4 – Request an Employer Identification Number (EIN)
Once you have registered your new business in Utah you will need to get an EIN for a number of reasons. These include paying taxes for your business, opening a bank account, obtaining credit cards or lines of credit, establishing terms with vendors and suppliers, hiring employees, and more.
There are only a few instances where you likely won’t need an EIN. More often than not, many business activities are just not possible without having an EIN.
An EIN is the business equivalent of a social security number and is used to track your business dealings. Even if you do not intend to hire employees, you will almost certainly still need an EIN for your Utah company and it protects you from having to use your social security number.
For more information on how to get an EIN number in Utah use our guide where you will find downloadable forms and links to the online process.
An EIN (also known as a federal tax id) is free to obtain from the IRS and you can apply online but if you are not comfortable filling in forms you can use a third-party document filing service to do this for you for a small fee. This ensures you are 100% compliant with the law and they handle everything with the IRS.
Step 5 – Obtain the Required Business Licenses and Permits
To operate your business in Utah you must comply with federal, state, and local government regulations. Utah law does not require a small business owner to have a “general” license to operate.
You will, however, need specific permits for specific businesses. For example, if you open a restaurant or similar food-related business you will most likely need a health permit, sales tax permit, facilities permit, and others. If you plan to sell alcohol, you will need a liquor license, essentially it all depends on the type of products and services your business is going to offer.
The business licenses you will need to acquire in order to register a business in Utah will also differ depending on the location of the business too.
You must find out how to obtain the necessary Utah business licenses and permits. This link is a PDF and has all the contact information you need so you can get a Utah license for your type of business. It will help you familiarize yourself with the permits and licenses your business may require to operate in Utah and lead you to the forms you will need to complete.
Alternatively, you could hire a professional document filing company to do this for you since it is time-consuming. It eliminates a lot of time and hassle and ensures you are correctly complying with Utah law. After all, Utah has no single generic business license that will ensure compliance with all requirements.
Step 6 – Determine Your Business Employer Requirements
There are several things you need to check regarding your responsibilities as an employer in Utah because there are requirements you must meet at the federal and state level. These could include various workforce commissions, safety, and state tax obligations, as well as labor law requirements including the minimum wage in Utah and employee rights and remedies under the Utah minimum wage act.
To learn more about Utah employer resources take a look at the Utah Labor Commission website.
Step 7 – Open a Business Bank Account for your Utah Company
As a new business owner, you should seriously consider separating your personal and business bank accounts to make it easier to track and account for your income and expenses. For certain business types, such as an LLC or a Corporation, it is essential that you open a separate business bank account to maintain your liability protection.
Once you have your EIN and your company registration documents, coupled with your driver’s license, you are ready to go to the bank and open your checking account.
Don’t worry, this won’t be expensive or leave you burdened with hefty monthly fees to pay – there are many free business bank accounts out there for you to choose from. Each has its different features and benefits, so you can decide what bank and checking account best suits your needs.
Summarizing Registering a Business in Utah
Utah’s business ecosystem is on the rise and continuously developing. The Beehive State has one of the best economic climates in the nation for businesses large and small. With an increased focus on aiding small businesses over the past several years, Utah is becoming an even more attractive place to register a business in. Additionally, with the ever-growing free and professional resources that are available, this is a win-win for entrepreneurs.
Small Businesses thrive in Utah because of its low state tax burden (4.66% corporate income tax rate), an ever-growing and stable economy (4th healthiest in the U.S.), readily available office space and other places of business, supportive local communities, a young and booming tech industry, and a highly-skilled workforce (44% college-educated).
The state fee for registering a business in Utah is $70 for an LLC and $70 for a corporation. The annual filing fee to maintain your company in Utah is a very affordable $15 for a corporation or an LLC.
The Beehive State is committed to your success and has many resources at your disposal that you can take advantage of.