Hawaii Income Tax for Business Owners: 1.4% to 11% Today, 13% Top Rate in 2027, Corporate 4.4% to 6.4% and Estimated Tax Dates
Hawaii Income Tax for Business Owners: 1.4% to 11% Today, 13% Top Rate in 2027, Corporate 4.4% to 6.4% and Estimated Tax Dates
Hawaii income tax for a business depends on how the business is organized. Owners of sole proprietorships, partnerships and most LLCs generally pay the individual income tax, which runs from 1.40% to 11.00% on the 2025 schedule. Corporations file Form N-30 and use a separate corporate schedule of 4.4% to 6.4%. Starting in 2027, Act 24 of 2026 changes the individual brackets and adds a new 13% top bracket. This guide covers the current rates, the 2027 changes, the estimated tax dates and the mistakes we see most often.
This article is general information, not legal or tax advice. Rates, thresholds and due dates change, and your position depends on your entity type, income and history. Confirm details with the Hawaii Department of Taxation (DOTAX) and a qualified CPA before you file or pay.
Which Hawaii Income Tax Applies to Your Business
Hawaii taxes business income either at the owner level or at the entity level. The structure you chose for federal purposes usually drives the answer, so confirm your classification with a CPA if you are unsure.
- Sole proprietors, partners and most LLC owners: Business profit generally flows to the owner's individual return and is taxed at individual rates.
- Corporations: Taxable income is reported on Form N-30 and taxed at the corporate rates covered below.
- LLCs: Hawaii imposes no separate LLC entity tax, and it has no franchise tax. An LLC's income is taxed through its owners or its corporate classification, not through a separate LLC tax.
The $12.50 annual report fee that LLCs and corporations pay to the Business Registration Division (BREG) is a filing fee, not an income tax. Annual reports are due by the end of the calendar quarter in which the entity registered, and no report is required in the year of registration.
Individual Income Tax Rates Today
For 2025, single and married filing separately taxpayers pay graduated rates. The rate starts at 1.40% on taxable income up to $9,600 and reaches 11.00% on taxable income over $325,000. Joint filers use a schedule with thresholds that double the single brackets under HRS 235-51.
Because the schedule is graduated, the top rate applies only to the portion of income that falls into that bracket. A high-earning owner does not pay 11.00% on every dollar of business profit.
The 2025 schedule is the most recent one described here. Before you file, confirm the rates for the tax year you are reporting with DOTAX at tax.hawaii.gov.
The 2027 Changes Under Act 24 of 2026
DOTAX Announcement 2026-06 describes Act 24 of 2026. For tax years 2027 and 2029, the second bracket falls from 3.2% to 2.5%, and the third bracket falls from 5.5% to 5%. A new 13% top bracket also applies to income above these thresholds:
| Item | 2025 schedule | Tax years 2027 and 2029 |
|---|---|---|
| Second bracket | 3.2% | 2.5% |
| Third bracket | 5.5% | 5.0% |
| Top rate | 11.00% | 13% |
| Top bracket starts above | $325,000 | $500,000 single; $750,000 head of household; $1,000,000 joint |
The announcement does not describe tax year 2028, so check with DOTAX before you plan for that year. The DOTAX announcement also does not restate the rates between $325,000 and the new thresholds. Ask DOTAX or your CPA how the 13% bracket fits with the rest of the schedule before you rely on a specific figure.
If your income is near $500,000 single or $1,000,000 joint, the timing of income and deductions can matter in 2027. That is a planning question for a CPA, and it should be answered before the year closes.
Corporate Income Tax on Form N-30
Hawaii corporate tax is graduated. It is not a flat 6.4% on all income.
| Taxable income | Rate |
|---|---|
| Not over $25,000 | 4.4% |
| Over $25,000 to $100,000 | 5.4%, less $250 |
| Over $100,000 | 6.4%, less $1,250 |
| Net capital gains | 4% alternative rate (HRS 235-71) |
Here is an example. A corporation with $150,000 of taxable income owes 6.4% of $150,000, which is $9,600, minus $1,250. That gives a Hawaii corporate tax of $8,350, or about 5.6% of income. Your numbers will differ, and credits, adjustments and net operating losses can change the result.
Corporations file Form N-30. For calendar-year corporations, the return is due April 20 under the DOTAX 2026 calendar.
Estimated Tax Payments and Key Dates
Hawaii requires estimated tax payments in installments. Whether you must make them depends on the tax you expect to owe, so confirm your obligation with DOTAX. For the 2026 tax year, the installment dates are:
| Installment | Due date for tax year 2026 |
|---|---|
| First | April 20, 2026 |
| Second | June 20, 2026 |
| Third | September 20, 2026 |
| Fourth | January 20, 2027 |
Today is October 27, 2026, so the next 2026 installment is due January 20, 2027. Calendar-year individual and corporate income tax returns are due April 20 under the DOTAX 2026 calendar. Put that date on your calendar as a Hawaii deadline and confirm the 2027 calendar when DOTAX publishes it.
General Excise Tax Is Not Income Tax
Hawaii has no sales tax. Instead, the General Excise Tax (GET) is levied on the business's gross income or gross receipts, not on the customer. Business owners often confuse the two, so keep them separate in your records.
- 4.0% state rate plus a 0.5% county surcharge, for a 4.5% rate on retail sales, most services, rents, construction contracting and commissions
- 0.5% on wholesaling and producing
- 0.15% on insurance commissions
All four counties (Honolulu, Hawaii, Kauai and Maui) have adopted the 0.5% surcharge through December 31, 2030. If you visibly pass GET on to customers, the maximum pass-on rate is 4.7120%.
Every business needs a GET license. It is a one-time $20 fee, applied for on Form BB-1 or through Hawaii Tax Online, and it stays active until you close it, surrender it or it is revoked. Processing is immediate in person, 5 to 7 business days through Hawaii Tax Online and 4 to 6 weeks by mail. License holders must file periodic and annual returns even in a period with no income.
Act 35: Federal Deductions Hawaii Does and Does Not Follow
Act 35 changes how Hawaii treats several federal items for taxable years after December 31, 2025:
- Qualified tips deduction: Hawaii conforms.
- Overtime deduction: Hawaii does not conform.
- Entertainment deduction: Hawaii disallows it.
If your federal return claims an item that Hawaii does not allow, you will need a Hawaii adjustment. Your CPA should review each year's federal-to-Hawaii differences before you file.
Common Mistakes to Avoid
- Treating GET as a sales tax. You owe GET on your gross receipts whether or not you charged the customer a separate line item.
- Applying the wrong schedule. Corporate rates on Form N-30 are not the individual brackets, and an owner's share of business profit is taxed on the individual return.
- Assuming the 2025 rates continue. Act 24 changes the brackets for 2027 and 2029, and the 2028 treatment still needs confirmation.
- Skipping installments. Missing an estimated payment date can create a penalty, so set reminders for the January 20, 2027 payment now.
- Confusing filing fees with taxes. The annual report fee and the $50 filing fee for articles are BREG charges, not income tax.
Official Resources
- Hawaii Department of Taxation: https://tax.hawaii.gov/
- General Excise Tax information: https://tax.hawaii.gov/get/
- Department of Commerce and Consumer Affairs, Business Registration Division: https://cca.hawaii.gov/breg/
- Hawaii Business Express (online filing): https://hbe.dcca.hawaii.gov/
- Hawaii Small Business Development Center: https://hisbdc.org/
- U.S. Small Business Administration, Hawaii district: https://www.sba.gov/district/hawaii
Next Steps
Start by confirming how your entity is classified, then pull the rate schedule for the tax year you are filing. If you expect to owe tax this year, calculate your estimated payments and schedule the January 20, 2027 installment. If your income is near the 2027 thresholds, or if you operate as a corporation with more than one owner, meet with a CPA before year end. A business attorney can also help if your ownership or entity structure is changing.
This article is informational only and is not legal or tax advice. Confirm every rate, threshold and due date with the Hawaii Department of Taxation before you file, and consult a qualified CPA or attorney for your specific situation.