The Hawaii Business Registration Division, also known as BREG, is an essential part of starting and operating a business in Hawaii. Proper registration with BREG ensures compliance with state laws and provides numerous benefits for businesses. This comprehensive guide covers everything you need to know about BREG in Hawaii.
What is BREG in Hawaii?
BREG stands for Business Registration Division and is a department within the Hawaii Department of Commerce and Consumer Affairs (DCCA). All businesses operating in Hawaii must register with BREG by filing the appropriate registration documents.
The main purposes of BREG are:
- Ensuring businesses comply with state laws and regulations
- Maintaining a public database of registered businesses
- Collecting state General Excise Tax (GET)
Businesses must renew their BREG registration annually to remain compliant in the state.
Why Register with BREG in Hawaii?
There are several important reasons for businesses to properly register with BREG:
1. It’s Required by Law
Hawaii law requires all persons or entities engaging in business activities in the state to register with BREG. This includes sole proprietors, partnerships, corporations, LLCs, nonprofits, and trusts. Failure to register can result in penalties.
2. Public Record of Legitimacy
Registration provides public proof that a business is licensed and legally operating in Hawaii. Consumers can search BREG records for reassurance when patronizing a business.
3. Tax Compliance
BREG registration enables businesses to legally collect General Excise Tax (GET) in Hawaii. GET must be collected on the sale of most products and services.
4. Prevents Duplicate Entity Names
Registering verifies that a business name is unique and not already in use in the state. This avoids confusion from duplicate names.
5. Allows Issuance of Required Licenses
Certain business licenses and permits can only be obtained by entities registered with BREG. For example, a liquor license.
6. Access to Business Incentives
Registration may provide access to tax incentives, grant programs and other business resources in Hawaii.
In summary, BREG registration establishes a business as a lawful entity in the state and provides advantages relating to taxes, licensing, incentives and consumer trust.
What Businesses Must Register with BREG in Hawaii?
Hawaii law requires registration for any person or organization engaging in business in the state, regardless of profit motive. The following entities need to register:
- Sole proprietorships
- General partnerships
- Limited partnerships
- Limited liability partnerships (LLPs)
- Limited liability companies (LLCs)
- Nonprofit corporations
- Cooperative associations
- Trustees of business trusts
- Associations and organizations
Business activities requiring registration include retail, wholesale, manufacturing, agriculture, rentals, professional services (i.e. medical, legal, etc.), contractors, lending, consulting and more.
Some common examples:
- Online sellers, e-commerce, network marketing
- Restaurants, food trucks, catering
- Tour operators, activity providers, transportation
- Doctors, lawyers, accountants, consultants
- House cleaners, landscapers, handymen/tradesmen
- Vacation rental owners, property managers
- Artists, craftspeople, writers, performers
- Churches, charities, social organizations
In general, if goods or services are exchanged for monetary or non-monetary compensation, registration with BREG is required.
Exceptions may apply in certain situations if activity is minimal or infrequent. When in doubt, register to avoid penalties.
How to Register a New Business with BREG in Hawaii
Registering a new business with BREG involves several key steps:
1. Select a Business Structure
Choose a legal structure such as sole proprietor, partnership, LLC, corporation, etc. Consider liability, taxes, and management flexibility in decisions.
2. Choose a Business Name
Select a name that is distinguishable from existing registered names. Check name availability with BREG.
3. File Registration Documents
Complete the applicable forms for your entity type. Forms include entity name, owners/managers, address, nature of business, etc.
4. Publish Required Public Notice
File a public notice in a newspaper to announce new registration. This verifies the business name is not already in use.
5. Obtain Licenses, Tax Licenses
Acquire any needed general excise, sales tax, or specialty licenses for your type of business.
6. Comply with County Regulations
Check county rules for zoning permits, vendor licenses, etc. based on location.
The BREG website provides instructions and forms for registering all types of business entities in Hawaii. Third-party services can also assist with the process.
How Much Does it Cost to Register a Business in Hawaii?
BREG registration fees depend on the legal structure chosen. Typical costs include:
- Sole Proprietorship – $50
- General Partnership – $50
- LLC – $100
- Corporation – $100
Additional expenses may include newspaper publication for public notice, taxes and specialty licenses. Overall costs range from $100-200+ depending on individual circumstances.
Many costs can be submitted together with the registration forms. BREG accepts payment by check, money order, or card.
Registering a business in Hawaii through BREG provides access to the lawful Hawaii economy at a reasonable price.
Steps for Registering a Sole Proprietorship with BREG
Sole proprietors make up a large share of Hawaii’s small businesses. Here are the steps to properly register:
1. File Form BB-1
Complete the Business Registration Application (BB-1) with the business name, owner name/address, description of activities, start date, and signature.
2. Obtain a GET Tax License
File Form BB-1 to receive a General Excise Tax license number. This is required to collect GET on sales.
3. Publish Registration Announcement
Publish a registration announcement in a major Hawaii newspaper. This verifies your business name is distinguishable.
4. Apply for Any Special Licenses
If needed, obtain licenses specific to your type of business (food service, massage, contractor, etc.)
5. Check County Regulations
Consult county rules for zoning, permits, vendor licenses, etc. Follow accordingly.
6. File Trade Name Registration
If using a DBA, file a trade name registration. Use Form TMK-24.
7. Renew Annually
Renew business registration each year by filing an Annual Report and paying fee. Due by March 1.
Following these steps ensures full legal compliance for sole proprietors in Hawaii.
What is Required for Registering an LLC in Hawaii?
Limited liability companies (LLCs) are popular choices for small business owners. Here are the BREG requirements:
- File Articles of Organization – Use Form L-28 to provide the business names, owners, addresses, agents, signatures, etc.
- Publish Notice of Intent – Publish LLC registration intent in a Hawaii newspaper.
- Apply for EIN – Obtain an Employer Identification Number (EIN) from the IRS.
- Obtain Licenses – Acquire any needed general excise, sales tax, or specialty licenses.
- Draft Operating Agreement – Create member-approved rules for LLC governance and structure. Not required for registration but recommended.
- File Annual Report – Submit an annual report with $15 fee to BREG before March 1 to maintain status.
- Pay State Taxes – Report income and pay applicable Hawaii taxes annually.
LLC registration provides owners liability protection while being fairly easy to set up and maintain. Keep records current with BREG and the state.
BREG Filing Requirements for Hawaii Corporations
Hawaii corporations must take the following steps to properly file with BREG:
- File Articles of Incorporation – Use Form DC-1 listing name, address, shareholders, purpose, officer names, signatures and more.
- Publish Announcement – Publish intent to incorporate in a Hawaii newspaper.
- Draft Bylaws – Create company bylaws establishing operating processes, leadership roles, meetings, etc.
- Issue Stock Certificates – Document the percentage of ownership through stock shares distributed to shareholders.
- Apply for EIN – Obtain an IRS Employer Identification Number for tax purposes.
- Obtain Licenses – Get any general excise, sales tax, or business-specific licenses needed.
- File Annual Report – Send annual report and pay fee to BREG before March 1st annually.
- Pay Taxes/Fees – Report income, submit filings, and pay applicable Hawaii corporate taxes each year.
While incorporating requires more initial tasks, it provides liability protection and credibility. Maintain compliance through BREG filings.
How to Change Business Information with BREG in Hawaii
It’s important to keep business details current with BREG in Hawaii. Follow these steps to update information:
- Review Records – Check existing BREG registration details and identify any out-of-date info.
- File Appropriate Amendment Form – Depending on entity type, submit Form AM-1, AM-05, AM-15, etc. with new details.
- Update Licenses – Modify any license numbers or addresses that need revision.
- Publish Change Notices – If changing the business name, publish a public notice in a newspaper.
- Report Within 10 Days – File amendments within 10 days whenever fundamental information changes.
- Renew Annually – Continue filing annual reports and paying renewal fees to maintain active status.
- Close Registration – If ceasing operations, notify BREG by submitting a cancellation request and final taxes.
Keeping information current avoids non-compliance. BREG makes it easy to submit changes as needed.
How to Close a Business Registration in Hawaii
Closing a Hawaii business registration involves a few simple steps:
- File a Cancellation Request – Submit the applicable cancellation form (BB-9, L-33, DC-16, etc.) signed by owners.
- File Final Taxes – Submit final general excise and transient accommodation tax forms, if applicable.
- Fulfill Other Obligations – Pay any outstanding government debts, taxes, unemployment insurance, etc.
- Cancel Licenses/Permits – Notify and cancel any active business licenses, permits, and provider agreements.
- Close Business Bank Account – Withdraw funds and close any bank accounts opened for the business.
- Update Address – Provide forwarding address for final tax documents, refunds, notifications.
- Save Records – Retain registration documents, tax filings for minimum of 4 years after closing.
Notify all affected parties. Once obligations are satisfied and a cancellation request is processed, BREG will mark the registration as closed.
Tracking Business Registration Status in Hawaii
BREG provides several ways to check the status of a Hawaii business registration.
- Search BREG Database – Use the online business search to confirm active registration status.
- Verify Documents – Review registration certificate and annual filing documents.
- Call BREG Hotline – Contact BREG call center during business hours for registration inquiries.
- Check Tax License – Validate registration through listed tax license numbers.
- Review Filed Forms – Check for timely filed annual reports and amendment forms.
- Confirm Public Notices – Search newspaper records to verify announcements were published.
- Seek Confirmation Letter – Request an official registration letter from BREG for proof of status.
Actively monitoring registration status helps avoid issues of non-compliance or inactivation.
Why Businesses Get Inactivated by BREG in Hawaii
There are a few common reasons businesses get involuntarily inactivated by BREG in Hawaii:
- Missed Annual Filing – Failure to submit an annual report and pay fee by the March 1 deadline.
- Returned Mail – BREG mail to registered business address gets returned undeliverable.
- Non-Compliance – Failure to file taxes, submit records, and provide information when requested.
- Abandoned Status – Business confirmed as closed/abandoned but didn’t formally request cancellation.
- Fraud/Criminal Activity – Serious violations can result in BREG penalties or involuntary termination.
- Bankruptcy/Dissolution – Business dissolved or ownership declared bankruptcy without proper registration closure.
- Non-Payment of Fees/Penalties – Outstanding renewal fees or penalties assessed by BREG.
Reactivation from inactive status is possible by clearing up any outstanding issues and paying a $100 penalty fee. Prevent inactivation by diligently maintaining compliance.
Consequences of Having an Inactive Business Registration in Hawaii
Allowing a Hawaii business registration to become inactive or lapse can lead to a number of problems:
- Non-Compliance – Business operating unlawfully until registration is reactivated.
- Tax Issues – Inability to legally obtain tax licenses or collect/remit taxes.
- Licensing Limitations – Loss of ability to renew or obtain operational licenses.
- Loan/Financing Troubles – Difficulty securing business financing without active registration.
- Vendor/Supplier Refusals – Third parties may refuse business relationships without valid registration.
- Penalties – Financial penalties, back taxes, and interest may accrue.
- Legal Liability – Greater personal liability for owners due to lack of active business shield.
- Consumer Distrust – Patrons are less likely to trust unregistered businesses.
Reactivate promptly and avoid complications. Letting registration lapse negates key advantages.
How to Reactivate an Inactive Hawaii Business Registration
If a Hawaii business registration becomes inactive, follow these steps to regain active status:
- Pay Any Back Taxes/Fees – Settle any BREG penalties or overdue tax balances.
- File Any Missing Reports – Submit annual reports for years registration was inactive.
- Pay $100 Reactivation Fee – Send fee payment along with reinstatement request form.
- Update Business Info – Submit amendments detailing any changed information.
- Renew Licenses – Regain proper tax and operational licenses for the business.
- Publish Notice – If the business name changed since inactivation, publish a new notice.
- Request Reactivation – File official request for registration reinstatement.
Once issues are resolved, BREG will reactivate registration. Going forward, carefully maintain annual compliance.
BREG Resources for Hawaii Businesses
BREG provides many helpful resources to guide Hawaii businesses:
- Website – The BREG website has FAQs, registration guides, document searches, and online filing.
- Business Forms – All registration and amendment forms can be downloaded from the website.
- Annual Filing Guide – An overview of renewal requirements, deadlines, and fees.
- Application Instructions – Step-by-step instructions for completing all registration applications.
- New Business Checklist – A checklist covering all filing steps and requirements.
- Business Name Search – Online database to verify and reserve business names.
- Tax License Search – Lookup tool to validate tax licenses.
- Business Registration Hotline – Call center for asking questions and getting assistance.
- Business Resource Center – Office locations on Oahu, Hawaii, Maui and Kauai offering in-person help.
BREG aims to provide helpful tools and support for Hawaii businesses. Take advantage of available resources for smooth registration and renewals.
Common Mistakes to Avoid When Registering a Business in Hawaii
While registering a business with BREG in Hawaii is fairly straightforward, some common mistakes can be avoided:
- Forgetting to publish the required new business registration announcement within 120 days of filing forms.
- Neglecting to properly close business registration when dissolving or merging an active entity.
- Failing to acquire necessary general excise and specialty licenses promptly after registration.
- Skipping or delaying the annual renewal report resulting in involuntary inactivation.
- Not updating changed information such as addresses, business names, owners, etc. in a timely manner.
- Operating a business before officially completing the registration process.
- Filing as a sole proprietor when a partnership or corporation structure would be more appropriate.
- Failure to maintain adequate business records and documentation of BREG filings.
With some care and planning, businesses can avoid these pitfalls. Leverage available BREG resources for guidance.
Answers to Frequently Asked Questions about BREG in Hawaii
Many business owners have questions about navigating BREG requirements in Hawaii. Here are answers to some common questions:
Q: How long does BREG registration take?
BREG processes routine business registrations within 1-4 weeks. Submitting complete information speeds the process.
Q: Does my business need any specialized licenses?
Some industries like food service, massage, and contracting require additional state or county permits. Check with BREG on needs specific to your business type.
Q: When is my annual renewal report due?
Annual renewal reports and fees must be submitted to BREG by March 1st of each calendar year to maintain active registration.
Q: What are the penalties for not registering my business?
Operating an unregistered business in Hawaii can result in financial penalties starting at $500 per violation up to fines of $25,000 in extreme cases.
Q: Can I file BREG paperwork by mail or online?
Registrations and renewals can be submitted by mail or online through the BREG Hawaii Portal in many cases. Some filings still require paper submission.
Q: How do I change the registered business name or address?
File an amendment form such as AM-05 or G-82 along with publishing a public notice of the change within 120 days.
Q: How do I close my business registration if I’m dissolving?
Submit a cancellation request form such as BB-9 and file final taxes. Notify regulatory agencies and business partners.
Step-by-Step Guide to Reserving a Business Name in Hawaii
Selecting and reserving a unique business name is an important part of the BREG registration process. Follow these key steps:
1. Brainstorm Possible Names
Make a list of potential business names that fit the brand image you want to build.
2. Search BREG Database
Use the online business name search to see if desired names are available or taken.
3. Search Beyond Hawaii
Also check trademark databases to ensure name is unique beyond just the state.
4. Choose Your Preferred Name
Select 1-3 final name candidates from your brainstormed list based on availability.
5. Optional: Engage a Third Party Search Service
For extra assurance, use a search company to perform comprehensive business name verification.
6. Reserve the Chosen Name
Submit the Business Name Reservation application (G-21 form) to BREG with the name to reserve.
7. Act Quickly Once Reserved
File your full business registration application within 30 days to secure the reserved name.
8. Renew Reservation Annually
Renew name reservation each year for up to 3 years total by filing G-22 form and $10 fee.
Following this process helps avoid naming conflicts and secure your preferred unique business name.
Choosing the Best Business Structure for Registration in Hawaii
Choosing the right business structure before registering with BREG involves weighing these key factors:
Liability Protection – Structures like corporations and LLCs provide personal liability shields, unlike sole proprietors.
Taxes – The structure impacts taxes paid by the business and owners. Consider eligibility for S-Corp election.
Record Keeping – More complex structures generally involve more administrative records and reporting.
Ownership Flexibility – Options like partnerships allow for easy addition of new co-owners.
Profit Allocation – Different structures enable customized allocation of profits and losses.
Cost – Structures like sole proprietors and partnerships have lower BREG fees than corporations or LLCs.
Financing – Banks may prefer lending to incorporated entities over sole proprietors.
Long-term Goals – Weigh future plans for growth, investors, and leadership transitions.
Consult with advisors to pick the optimal structure aligned with your business goals and circumstances.
Understanding Hawaii General Excise Tax Licenses
One vital component of the BREG registration process is obtaining a General Excise Tax (GET) license number. Key facts on GET registration:
- Required for Businesses – GET registration and collection is mandatory for companies selling products/services in Hawaii.
- Unique GE Number Issued – Each business is assigned a GET license number after registering.
- Report on GET Forms – GE tax return forms must be filed regularly reporting sales and taxes collected.
- Pay 4% GET Tax – Hawaii’s GE tax rate is 4% of gross income. Some exemptions exist.
- Display GE License – Businesses must visibly display their GET number on sales receipts, invoices, etc.
- Link GE Number to BREG – GE license serves as proof of valid BREG registration.
- Renew Annually – GET registration must be renewed each year along with business registration.
Proper GET licensing and tax remittance keeps businesses compliant with Hawaii tax regulations.
Using Third Party Services for Hawaii Business Registration
Hawaii business owners can hire third party services to assist with BREG registration and compliance:
Legal Counsel – Business attorneys can provide guidance on choosing an optimal business entity structure.
Tax Professionals – CPAs and accountants can ensure tax compliance.
Government Liaisons – Permit expediters facilitate licenses, zoning, and regulatory approvals.
Registered Agents – Hawaii-based agents can file forms and serve as a business’ registered local contact.
Business Formation Services – Companies like Incfile and LegalZoom offer registration package deals.
Virtual Office Providers – Provide Hawaii addresses and mail forwarding to meet residency requirements.
Record Keeping Services – Help maintain proper Hawaii records and filings.
Annual Report Preparation – File annual renewal reports on the business’s behalf.
Leveraging professional help avoids missteps and keeps registrations compliant. Fees vary based on services provided.
How to Amend Business Information With BREG in Hawaii
During the life of a business, it may become necessary to amend details on a BREG registration. To do so:
- Review registration records and identify information needing change.
- Select the appropriate amendment form. For example, use AM-20 to amend a corporation or AM-05 to amend an LLC.
- Complete the form with the new, updated information. Detail what is being changed from previous filings.
- Attach any necessary supporting documents. This may include new business formation documents if significantly altering the original registration.
- Pay applicable amendment fees, typically $5 per form amended.
- For major changes like business name or address, also publish a public notice within 120 days.
- Submit the amendment materials to BREG for processing. Keep a copy for your records.
- Allow 3-4 weeks processing time. Verify changes when the amended certificate arrives.
Catching changes early streamlines the amendment process. File within 10 days of material alterations.
Tips for Maintaining Proper Records for a Hawaii Business Registration
Proper record keeping helps keep BREG registrations compliant. Useful tips:
- File original formation documents and certificates securely. These establish legal existence of the entity.
- Retain amendment filings that change early registration details over time.
- Carefully store annual renewal reports submitted each year.
- Keep licenses, tax registrations, and permits together for easy reference.
- Maintain up-to-date contact info for all owners, officers, and managers.
- Keep operating agreements, by-laws, member resolutions handy for modification.
- Back up digital copies of registrations materials like completed applications.
- Save confirmation emails and letters from BREG for each submission.
- Label materials clearly by entity name and filing date.
- Designate one owner responsible for maintaining centralized records.
- Keep past year records available for 4 years minimum per tax requirements.
Orderly records make managing BREG compliance easier as businesses evolve.
Key Reasons to Keep Business Registration Current in Hawaii
Maintaining an active, updated registration with BREG is essential for Hawaii businesses for several reasons:
- Remain legally compliant and avoid penalties
- Smoothly renew operational licenses each year
- Reflect changes like new addresses, owners, business names
- Prove legitimacy and active status to customers and vendors
- Qualify for business loans and government incentives
- Prevent business disruption and involuntary inactivation
- Avoid limitations on collecting taxes like GET
- Enable uninterrupted vendor relationships and transactions
- Obtain licenses for new locations, products, or services
- Facilitate audits and requests for verification of registration
By keeping details current, businesses reap the full benefits of BREG registration while avoiding many headaches.
Services Provided by the Business Registration Division in Hawaii
BREG provides many useful services for businesses beyond just registrations, including:
- Business name search and reservation
- Document filing for new registrations and amendments
- Online business entity database for public record searches
- Call center support to answer registration questions
- Dissemination of renewal reminders and filing information
- Processing of annual renewals and payments
- Tools for online business registration and renewal
- Information on business type comparisons and requirements
- Details on taxes, rules, and regulations for Hawaii businesses
- Assistance with navigating any required specialty licenses
- Easy access to business registration forms and instructions
- Support for reinstating inactive registrations
- Handling registration cancellations and closures
BREG aims to educate, guide, and support Hawaii businesses through their full life cycle.
Transitioning Ownership of a Hawaii Business Registration
When ownership of a Hawaii-registered business changes hands, proper steps must be taken to update the associated BREG registration:
- File Articles/Amendments – Submit new filings detailing the change in control and ownership structure.
- Update Managers – Appoint new leadership like officers, and managing members and update with BREG.
- Notify Government Agencies – Inform agencies like the IRS, county regulators, and specialty licensing boards of changes.
- Cancel/Reissue Licenses – Apply for licenses under the new ownership as needed.
- Change Account Information – Update authorized bank account, tax, vendor details to new owners.
- Update Company Records – Change registered address, websites, branding, etc. to reflect new control.
- Announce to Public – Use channels like social media, press releases to share news of the transition.
- File New Trade Name – If continuing operations under a DBA, register new trade name with BREG.
- Notify Customers/Vendors – Communicate updates to existing business relationships.
A smooth ownership changeover maintains trust and compliance. Consult advisors for guidance.
Checking Business Name Availability Outside Hawaii
When naming a Hawaii business, it’s important to check name availability beyond just the state BREG records. Ways to perform a broader search include:
- United States Patent and Trademark Office – Search federal trademarks and patents at USPTO.gov.
- Domain Name Registration – Verify domain availability from registrars like GoDaddy.
- Google Search – Search for mentions of the potential name on search engines and social media.
- Business Formation Sites – Use sites like LegalZoom and Incfile to check availability across states.
- Commercial Databases – Paid comprehensive searches via LexisNexis and Dun & Bradstreet.
- Compare Against Common Brands – Review against major known brands relevant to your niche.
Avoid legal conflicts and branding confusion by ensuring your name stands out from existing businesses nationwide.
Penalties for Operating Without Registering a Business in Hawaii
Attempting to operate a business in Hawaii without proper BREG registration can lead to:
- Fines up to $500 Per Offense – Conducting unregistered business triggers escalating penalties.
- Misdemeanor Criminal Charges – The state may file criminal charges for repeated, willful violations.
- Inability to Legally Collect Taxes – Those without GET licenses cannot lawfully collect Hawaii GE tax.
- Possible Injunction – Courts may order unregistered firms to stop unlawful operations.
- Consumer Distrust – Patrons are wary of using businesses not properly registered.
- Difficulty Securing Financing – Unregistered businesses deemed higher risk.
- Challenges Obtaining Licenses – Permits may require valid registration.
- Increased Tax Audits – Greater chance of audit by not filing expected tax returns.
Avoid legal action, fines and reputational damage by registering before conducting business.
Proper registration with the Hawaii Business Registration Division is crucial for legally operating and harnessing the full benefits of doing business in the state. While BREG rules may seem daunting, this guide breaks down all the key details into clear, actionable steps. Use the information covered here to smoothly establish or renew your Hawaii business registration. With a diligent, organized approach, BREG compliance can be straightforward. The payoff is access to helpful resources and protection under Hawaii’s commercial law. Use this article as your playbook for smart BREG registration from start to finish.