Delaware Franchise Tax Guide — LLC $300/Year Annual Payment
Everything you need to know about the Delaware franchise tax: what it costs, when it's due, and how to pay it online step by step.
Key Takeaways
- Delaware LLCs pay a flat $300/year franchise tax (not tied to revenue)
- LLC deadline: June 1st each year
- C-Corp deadline: March 1st each year
- Late penalty: $200 + 1.5%/month interest
- LLCs do NOT file a separate annual report — just pay the tax
What Is the Delaware Franchise Tax?
Delaware calls its annual business maintenance payment the “franchise tax.” This is not a tax on income or revenue — it is the fee you pay to remain in Good Standing with the State of Delaware. Every LLC, LP, and corporation registered in Delaware must pay it, regardless of whether the business earns any money.
Unlike many other states, Delaware does not require LLCs to file a separate annual report. Your only obligation is to pay the franchise tax by the deadline each year.
Entity Type Differences
- LLC: Flat $300/year — simple and predictable
- C-Corp: Varies by size — minimum $175, maximum $200,000
- LP/GP: $300/year (same as LLC)
Fee Breakdown
Here is exactly what each entity type pays and when it is due.
| Entity Type | Annual Fee | Deadline |
|---|---|---|
| LLC / LP / GP | $300 flat | June 1 |
| C-Corp (Authorized Shares) | Min $175 | March 1 |
| C-Corp (Assumed Par Value) | Min $400 | March 1 |
LLC / LP / GP
Annual Fee: $300 flat
Deadline: June 1
C-Corp (Authorized Shares)
Annual Fee: Min $175
Deadline: March 1
C-Corp (Assumed Par Value)
Annual Fee: Min $400
Deadline: March 1
C-Corp Calculation Methods
C-Corps have two calculation methods: Authorized Shares (minimum $175) and Assumed Par Value Capital (minimum $400). Delaware calculates both and you pay whichever amount is lower. The maximum franchise tax for any C-Corp is $200,000/year.
System Availability
Delaware's online payment system is not available 24/7. The system operates daily from 8:00 AM to 11:45 PM Eastern Time. It closes 15 minutes before midnight for maintenance.
Tip: If you try to access the payment portal and do not see the payment button or get an error, check the time. The system may be down for its nightly maintenance window (11:45 PM - 8:00 AM ET). Try again during operating hours.
How to Pay — Step by Step
Follow these steps to pay your Delaware franchise tax online.
Go to the payment portal
Select your entity type
Click “click here to pay LLC/LP/GP taxes” for LLCs, or the corporation link for C-Corps.
Look up your File Number
If you do not know your Delaware File Number, look it up at Delaware Entity Search. Search by your company name to find it.
Enter File Number and pay
Enter your File Number on the payment page and complete the payment by credit card or ACH.
Save your confirmation
Save or screenshot the confirmation page. You will also receive an email receipt. Keep both for your records.
Deadlines & Penalties
Deadlines
- LLCs / LPs / GPs: June 1st each year
- C-Corps: March 1st each year
Late Penalties
- $200 flat penalty applied immediately after the deadline
- 1.5% per month interest on both the unpaid tax and the penalty
- Interest compounds monthly — the longer you wait, the more you owe
- Severe delinquency can result in voiding your Good Standing status
If your entity loses Good Standing, you may face difficulty opening bank accounts, entering contracts, or proving your business is legitimate. Always pay on time.
Delaware Tax Advantages
Delaware is known for being “business-friendly,” but the specifics matter. Here is what Delaware actually offers — and what it does not.
Advantages
- No state sales tax (but Delaware has a Gross Receipts Tax on sellers at 0.1%-2.4%)
- Only taxes income apportioned to Delaware — not a blanket out-of-state exemption
- For C-Corps: dividends to non-resident shareholders generally not subject to Delaware withholding
- Court of Chancery — specialized business court with decades of case law
- Flexible corporate law allowing custom governance structures
Important Nuances
- Delaware has a Gross Receipts Tax (0.1%-2.4%) that applies to sellers with Delaware nexus
- “No state income tax on out-of-state income” is apportionment, not a blanket exemption
- S-Corps must withhold for non-resident shareholders on Delaware-sourced income
- The $300/year LLC franchise tax applies regardless of revenue — even $0 revenue LLCs pay it
Who Should Choose Delaware?
Delaware is the right choice for a specific type of business. For most solo foreign-owned LLCs, it is more expensive than necessary.
Delaware Is Best For
- Companies planning to raise venture capital
- Businesses with complex equity structures (multiple share classes, convertible notes)
- Companies expecting business disputes that benefit from the Court of Chancery
- Startups that need Delaware C-Corp status for investor expectations
Consider Alternatives Instead
For solo developers, freelancers, or small teams, these options save significant money:
- Wyoming: $60/year — best overall value for foreign-owned LLCs
- New Mexico: $0/year — cheapest option with no annual fees
Read our full state comparison guide to see how Delaware stacks up against Wyoming and New Mexico on cost, privacy, and ease of use.
FAQ
What if I miss the deadline?
Pay as soon as possible. A $200 late penalty is applied immediately, plus 1.5% per month interest on the tax and penalty. The longer you wait, the more it costs.
Does my LLC need to file an annual report?
No. Delaware LLCs do not file a separate annual report. Your only obligation is to pay the $300 franchise tax by June 1st each year.
Can someone pay on my behalf?
Yes. Your registered agent or any authorized person can pay the franchise tax on your behalf. Many registered agents offer this as part of their service.
How is C-Corp franchise tax calculated?
Delaware uses two methods: the Authorized Shares method (minimum $175) and the Assumed Par Value Capital method (minimum $400). The state calculates both and you pay whichever result is lower. The maximum tax is $200,000.
Pro Tip: Set a calendar reminder for May 1 (LLC) or February 1 (C-Corp) to give yourself a full month to prepare and pay before the deadline. Do not wait until the last day — the online system has limited hours and may be busy near deadlines.