What reports does the Texas Comptroller require from my small business each year?
The biggest annual requirement is the Texas franchise tax report. Every LLC, corporation, partnership, and other taxable entity formed or doing business in Texas must file one each year by May 15th. This is true even if your business owes zero franchise tax.
If your total revenue falls below the no-tax-due threshold (currently $2.47 million), you file a No Tax Due Report. Businesses with revenue at or below $20 million can use the EZ Computation Report for a simplified calculation. Larger businesses file the Long Form and choose between cost of goods sold or compensation as their deduction method. Most small businesses in Pearland and the Houston area will fall into the No Tax Due category, but you still have to file every year.
Along with your franchise tax report, you must submit either a Public Information Report (for corporations and LLCs) or an Ownership Information Report (for other entity types). This tells the state who owns and manages your business. It files at the same time and is not optional.
If your business collects sales tax, you have separate filing obligations with the Comptroller. The frequency depends on how much tax you collect. Businesses collecting less than $1,500 in state sales tax per quarter may qualify for annual filing. Higher collection amounts require quarterly or monthly returns. Even during periods with no taxable sales, you must file a zero-dollar return as long as you hold an active sales tax permit. Keeping up with sales tax management is important because late filings carry penalties and interest that add up quickly.
Texas does not have a state income tax, so there is no income tax return to file with the Comptroller. The franchise tax report is what takes its place, and it is calculated based on total revenue rather than net income.
Other industry-specific filings may apply depending on what your business does. Businesses selling alcohol file mixed beverage tax reports. Motor fuel dealers have separate requirements. But for most small businesses, the franchise tax report and sales tax returns are the two Comptroller filings you need to worry about.
The consequences of not filing are serious. The Comptroller will forfeit your entity’s right to do business in Texas for failure to file franchise tax reports. That means you lose your liability protection and good standing with the Secretary of State. Reinstating your entity costs money and takes time, and the longer you wait the more complicated it gets. Sales tax non-compliance can result in penalties, audits, and eventually having your permit revoked.
A bookkeeper in Pearland who understands Texas requirements can make sure these filings happen on time and with the right numbers. The reports themselves are not complicated for most small businesses, but forgetting about them or not knowing they exist is where owners run into trouble.
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