Business Tax Filing and Payment Information

Overview of the Business Taxes

City of Portland Business License Tax

The City of Portland began requiring a business license in 1854. Over the years, the City of Portland Business License Tax has been required for regulatory and revenue purposes. Today, Portland's Business License Tax is a net income tax on business activity (including renting residential and commercial real property) conducted in Portland. It is used as revenue for the General Fund (police, fire, some parks programs, and general government functions). Portland's Business License Tax is not a regulatory permit fee and does not entitle a taxpayer to engage in business activity not otherwise allowed by federal, state and/or local laws.

Multnomah County Business Income Tax

Multnomah County changed from requiring a business license to assessing a business income tax in 1976. In 1993, the City of Portland and Multnomah County achieved code conformity and joint administration of the two separate programs. The Multnomah County Business Income Tax is an income tax on net business income. Revenue generated from the Multnomah County Business Income Tax goes to the County General Fund and is used to finance libraries, law enforcement, community corrections, jails, juvenile justice, bridges, social services, and health services.

Metro Supportive Housing Services (SHS) Business Income Tax

In May 2020, voters in greater Portland approved a Measure to fund supportive housing services for people experiencing or at risk of experiencing homelessness. This program will provide funding for housing assistance and wraparound services, with the goal of ending chronic homelessness in the region. The program is funded, in part, by a business income tax on net income for businesses with gross receipts above $5 million that operate in Metro's jurisdiction.

This tax is effective for tax years beginning on or after January 1, 2021.

Registration Requirements

Presumption of Doing Business

You are generally considered to be "doing business" in the City of Portland, Multnomah County, and/or Metro if you are engaged in any profit-seeking activity in those jurisdictions. Doing business includes activities carried out by you or on your behalf through officers, agents, or employees. 

A taxpayer having one or more of the following is doing business in the City of Portland, Multnomah County, and/or Metro and must register for a Revenue Division tax account.

• A stock of goods.
• An office.
• A place of business (other than an office) where affairs of the business are regularly conducted.
• Employees or representatives providing services to customers as the primary business activity (such as accounting or personal services), or services incidental to the sale of tangible or intangible personal property (such as installation, inspection, maintenance, warranty, or repair of a product).
• An economic presence through which the taxpayer regularly takes advantage of Portland, Multnomah County, and/or Metro's economy to produce income.  
• Your business owns, leases, rents, or sells personal or real property (including residential or commercial property) in the City of Portland, Multnomah County, and/or Metro jurisdiction.

Disregarded Entities

A disregarded entity (i.e. an entity that does not file a federal tax return separate from it's owner), such as a limited liability company (LLC) with only one member, is deemed to be the tax entity that includes the income of the disregarded entity in its federal tax return – if the disregarded entity will be disregarded as a separate tax entity. In other words, single-member LLCs that are disregarded for federal income tax purposes would not file a City/County business income tax return at the LLC level. The person that files the federal income tax return that reports the income of the disregarded entity would be the City/County filer. The same applies to other types of disregarded entities, such as qualified subschapter S subsidiaries (QSubs) and grantor trusts.

Example: A single-member LLC is owned by an individual. The LLC is disregarded (and does not file a federal or state income tax return) for federal income tax purposes and the income of the LLC is directly reported on that individual’s tax return (Form 1040). The individual would be the filing entity for City/County purposes and they would include the income of the disregarded entity on their City/County business income tax return.

City of Portland Business License Tax and/or Multnomah County Business Income Tax

Businesses that are operating within the City of Portland and/or Multnomah County (including rideshare drivers) must register for a Revenue Division tax account within 60 days.

To see if your work location is located within Portland and/or Multnomah County, visit Portland Maps and enter the address of the work location. If you are working within both tax jurisdictions, you are generally subject to both taxes. If you are only doing business in Multnomah County (Gresham, Troutdale, Corbett, etc.) you must still register with the Revenue Division, but you will only be liable for the Multnomah County Business Income Tax.

Metro Supportive Housing Services (SHS) Business Income Tax

Businesses with total gross receipts of more than $5 million that are also operating within the Metro jurisdiction must register for a Revenue Division tax account.

NOTE: If you are a sole proprietor subject to the City of Portland Business License Tax and/or Multnomah County Business Income Tax, you are not liable for the Metro Supportive Housing Services (SHS) Business Income Tax. As a sole proprietor, you will instead be liable for the Metro Supportive Housing Services  (SHS) Personal Income Tax.

To determine if your business address is located in the Metro jurisdiction, visit the Metro Boundary Address Lookup tool. Enter the address of your work location to verify if it is within the Metro boundary. 

Business Tax Rates and Other Fees/Surcharges

Business Tax Rates

City of Portland Business License Tax rate: 2.6%

Multnomah County Business Income Tax rate: 2%

Metro Supporting Housing Services (SHS) Business Income Tax rate: 1%

Related Business Taxes, Fees, and Surcharges

Residential Rental Registration (RRR) Fee

For tax years beginning on or after January 1, 2018, all owners of residential rental property within the City of Portland are required to register their residential rental unit and may owe the Residential Rental Registration (RRR) fee. Visit our Residential Rental Registration page for more information about the filing and payment requirements. 

Heavy Vehicle Use Tax (HVT)

For tax years beginning on or after January 1, 2016, the Heavy Vehicle Use Tax (HVT) is imposed on taxpayers who operate one or more heavy vehicles on streets owned or maintained by the City of Portland. Visit our Heavy Vehicle Use Tax page for more information about the filing and payment requirements.

Clean Energy Surcharge (CES)

For tax years beginning on or after January 1, 2019, the Clean Energy Surcharge (CES) is imposed on businesses that have at least $500,000 in Portland gross income and $1 billion in total gross income. Visit our Clean Energy Surcharge page for more information about the filing and payment requirements.

Pay Ratio Surtax (PRS)

For tax years beginning on or after January 1, 2017, the Pay Ratio Surtax (PRS) is imposed on publicly traded companies subject to U.S. Securities and Exchange Commission pay ratio reporting requirements. Review Business Tax Administrative Rule 500.17-1 - Pay Ratio Surtax (LIC-5.02) for more information.

Business Tax Return Filing Requirements

Taxfilers must file their business tax returns and pay their business tax liability at the same time they file their federal and state income tax returns (generally, April 15 for calendar year taxfilers). For taxfilers that have different federal or State of Oregon filing due dates, please read our policy on when your returns are due.

Taxfilers who qualify for an exemption from the City of Portland and/or Multnomah County Business Income Taxes must still file a Business Tax Return with their supporting tax pages.

Businesses who qualify for an exemption from the Metro Supportive Housing Services (SHS) Business Income Tax do not need to file a Metro SHS Business Income Tax return.

Electronic filing is only available for select software programs at this time. Visit our eFile vendor page to see if your software provider allows the option for electronic filing.

Exemptions

City of Portland Business License Tax and/or Multnomah County Business Income Tax

If a taxfiler qualifies for one or more of the exemptions from the City of Portland Business License Tax and/or Multnomah County Business Income Tax, they must file their business tax return to request an exemption each year and provide supporting tax pages.

Certain taxfilers are exempt under the City of Portland and/or Multnomah County Business Income Tax codes, Administrative Rules, and Policies. These exemptions include, but are not limited to:

• Taxfilers whose gross business income amounts to less than $50,000 from all business receipts everywhere.
  • For tax years beginning on or after January 1, 2020, taxfilers whose gross business income amounts to less than $100,000 from all business receipts everywhere may qualify to be exempt from Multnomah County Business Income Tax only.
• Real estate brokers working under the supervision of a principal broker (City of Portland Business License Tax only).
• Individuals whose only business transactions are exclusively limited to the renting or leasing of less than ten total residential real property dwelling units, regardless of whether the units are located inside or outside of Multnomah County (Multnomah County Business Income Tax only).
• Individuals whose only income is:
  • Wages,
  • Gain on sale of primary residence,
  • Gain on sale of personal property acquired for personal or household use, and/or
  • Investment earnings (if not part of a business).
• Corporations exempt from the Oregon Corporation Excise Tax under ORS 317.080 (generally not-for-profit corporations), unless subject to tax on unrelated business income.
• Trusts exempt from Federal income tax under IRC § 501, unless subject to tax on unrelated business income.
• Persons whose only business activity is raising or harvesting the person's own crops or livestock.
• Persons who operate a display booth in a permanent structure for less than 14 days in a tax year. These circumstances require a Temporary Business License.

The Revenue Division will send them a notice requesting them to file a return. If the taxfiler does not file their Business Tax Return, Civil Penalties will be assessed and collection activities will begin.

Metro Supportive Housing Services (SHS) Business Income Tax

If a taxpayer qualifies for one or more of the exemptions from the Metro Supportive Housing Services (SHS) Business Income Tax, they do not need to file a return with the Revenue Division.

Certain taxpayers are exempt under Metro Business Income Tax Code, Administrative Rules, and Policies. These exemptions include, but are not limited to:

• Businesses whose gross business income amounts to $5,000,000 or less from all business receipts everywhere.
• Sole proprietors and disregarded entities that are subject to the Metro SHS Personal Income Tax.
• Corporations exempt from the Oregon Corporation Excise Tax under ORS 317.080 (generally not-for-profit corporations), unless subject to tax on unrelated business income.
• Trusts exempt from Federal income tax under IRC § 501, unless subject to tax on unrelated business income.
• Businesses who operate a display booth in a permanent structure for less than 14 days in a tax year.

Requesting an Extension to File

If a taxfiler cannot complete their business tax return by the original due date, they may request a six-month extension to file their business tax return. This extension should be accompanied by a payment of the estimated tax due, if applicable. This is an extension to file only. There is no extension to pay the business taxes.

Due dates for tax returns and extensions are based on fiscal year end of the taxfiler.

Federal or state tax extensions are accepted. If a taxfiler has requested an extension to file with the IRS or State of Oregon, they must attach their federal/state extension to their Business Tax Return when they file and check the "Federal Extension" box. All business taxes must still be paid by the original due date. Late payment penalties will be applied to any tax due that is not paid by the original due date.

NOTE: If you have filed a federal extension and receive a Notice to File letter from us, please contact our office to notify us of the federal extension.

Tax Entity Changes

Existing businesses that have changed their tax entity (for example, a sole proprietor who has incorporated into an S corporation) need to register the new tax entity and get a new business tax account number.

Paying Your Business Taxes

The payment for your businesses taxes is due at the same time you file and pay your federal and state taxes (generally April 15 for most filers). If you have requested an extension of time to file your tax return, your payment is still due on the original due date. There is no extension to pay your business taxes.

Failure to pay the business taxes by the original due date will result in late payment penalties and interest.

Quarterly Estimated Payments

A taxfiler must pay quarterly estimated payments for the City of Portland, Multnomah County, and Metro business taxes if the current tax liability for any tax program will be $1,000 or greater, and the taxfiler's prior year tax liability for that tax program was also $1,000 or greater.

Each quarterly estimated payment should equal 25% (or more) of the current year's estimated tax liability.

For calendar year filers, quarterly estimated payments are due on:

For fiscal year filers, quarterly estimated payments are due on: 

*Please note, the fourth quarterly estimated payment due date is one month earlier than the January 15 due date of the federal and Oregon quarterly estimated payments for individuals.

A taxpayer will be subject to quarterly underpayment interest if they are required to make quarterly estimated payments and by the due date of the 4th quarter payment have not made four quarterly estimated payments that equal:

• 100% of the prior year liability, or
• 90% of the current year liability

Quarterly underpayment interest is calculated at an annual rate of 10% for each quarter that payments are late or less than the amount due.

Payment Plans

The Revenue Division recognizes that at times it may not be possible for a taxpayer to pay their tax liability in full. To encourage payment of all amounts due, the Revenue Division will consider entering into a payment plan agreement to ensure collection. Taxpayers are not eligible for a payment plan if the taxpayer fits into one of the following categories:

• The taxpayer has defaulted on a payment plan with the revenue Division within the last 2 years.
• The taxpayer has been referred to the City Attorney for legal action. They must enter into a confession of judgment instead.

A payment plan may be approved when the taxpayer has no other method of financing this debt (such as a credit card cash advances, home equity loan proceeds, business loans, etc.) The taxpayer must remain in compliance with City and County tax codes during the term of the payment plan.

Payment Plan Requirements

Generally, there is a $25 set up fee for a payment plan. The Revenue Division may discuss payment plan options and give approval to the taxpayer, provided the options meet the criteria established below. 

• If you can pay the full amount you owe within 12 months, you can avoid paying the fee to set up the payment plan agreement.
• If a payment plan agreement of more than 24 months is needed, the set-up fee increases to $50 and supervisor approval is needed.

If terms outside these are requested, Revenue Division management will review the proposed alternate terms on a case by case basis.

The payment plan due date is the 10th or the 25th of the month, at least 16 days after the date the payment plan was set up. Interest continues to accrue during the repayment period.

All payments must be made by the due date. Failure to pay any installment of the payment plan by the due date will result in the payment plan being considered in default and any outstanding balance will become immediately payable.

Payments not received within five (5) business days after the due date will be considered late. The Revenue Division will allow one late payment. A second late payment will cause the entire outstanding balance to become immediately due and any penalty waiver granted under the Revenue Division’s penalty assessment policy would be immediately reinstated to the outstanding balance.

Delinquent Taxes

If payment for taxes due nor a protest to increased taxes is timely received, the Revenue Division may assess additional interest and penalties, including civil penalties of $500 per violation of the City and County tax codes. The Revenue Division may also begin collection activity for the balance due for your account.

If the Revenue Division refers your account to a third-party collection agency, additional fees up to 25% of the total balance due may be added to your debt, and you must contact the collection agency about your debt.

If the Revenue Division refers your account to the City Attorney's office, additional court or legal fees may be added to your debt.

Certificate of Compliance

The Revenue Division may issue or otherwise provide access to either an electronic or printed “Certificate of Compliance” upon registration to assist businesses in proving their compliance to regulatory agencies or to the public.

To view your Certificate of Compliance online, you must register for a Revenue Division Tax Account. If you already have registered for an account, you can log in to Portland Revenue Online (PRO) to view and print your Certificate of Compliance.

To request a printed copy of your Certificate of Compliance, please contact the Revenue Division by phone or email.

Refunds

Refunds for the City of Portland, Multnomah County, and Metro business taxes are generally issued within 8-10 weeks after the complete tax return is filed (with supporting tax pages). Due to high volumes of mail, tax returns filed in March/April and September/October may require additional time for a refund to be issued.

Refunds will be issued only in the event of overpayment, duplicate payments, or a payment made when no tax was due. All requests for refund must be made in writing.

An online payment made Monday through Friday may be voided on the same day it is made by canceling the payment before 4 pm Pacific Time.

ACH Refunds

To receive your refund via direct deposit, you must file your return electronically and request a refund on that return using Portland Revenue Online or through an approved eFile vendor.  

Closing your Revenue Division tax account(s)

When a business is sold, closed, or no longer operates within the City of Portland, Multnomah County, and/or Metro's jurisdiction, they should notify the Revenue Division to close their business tax account(s). When a business tax account is closed, a taxfiler should:

1. File a Business Tax Return for the final year the business operated in the City, County and/or Metro.
2. Complete the Out of Business form (or a statement with the same information) and attach it to the Business Tax Return. Make sure to provide:
   • The new owner's name and address (if the business or property has been sold).
   • Whether you ceased all business activity or only activity in the City of Portland, Multnomah County and/or the Metro jurisdiction.

Don't close the business tax account if:

• There is contract (installment) sales from the sale of the business. This income is considered continuing business income and will require annual filings.
• A taxfiler owns real property and intends to rent or lease it to others.
• The business performs services inside Portland and/or Multnomah County.
• The business provide services to customers who live in Portland and/or Multnomah County.

Business Tax Codes, Administrative Rules, and Policies

City of Portland Business License Tax

City of Portland Business License Law

Business Tax Administrative Rules

Business Tax Administration Policies

Multnomah County Business Income Tax

Multnomah County Business Income Tax Code

Business Tax Administrative Rules

Business Tax Administration Policies

Metro Supportive Housing Services (SHS) Business Income Tax

Metro SHS Business Income Tax Code (Chapters 7.05 and 7.07) and Administrative Rules

Business Tax Administration Policies