New Hampshire Has No Income Tax, but Your Business May Owe BPT and BET: 2025 Thresholds, BT-SUMMARY and Estimated Payments

2026-10-13 · RKube Services

New Hampshire business tax: who must file BPT and BET in 2025, the $109,000 and $298,000 thresholds, BT-SUMMARY and estimated payments.

New Hampshire is famous for what it doesn't tax. There's no tax on wages and no general sales tax, and the Interest and Dividends Tax was repealed for periods beginning on or after January 1, 2025. So it surprises a lot of owners in Manchester, Nashua and Portsmouth when a letter from the Department of Revenue Administration (DRA) arrives asking why they never filed a business return.

The answer is that New Hampshire taxes businesses, not people. Two separate taxes apply: the Business Profits Tax (BPT) on profits and the Business Enterprise Tax (BET) on what the business pays out in wages, interest and dividends. Each has its own filing threshold, and a sole proprietor or single-member LLC can owe one, both or neither. This guide walks through the 2025 thresholds, how the two taxes fit together, the BT-SUMMARY that ties the filing together and the estimated payments most owners miss.

The New Hampshire (NH) BPT and BET numbers at a glance

All figures below come from the DRA's own pages and the 2025 form instructions.

Sources: DRA Business Profits Tax FAQ, DRA Business Enterprise Tax FAQ, and the 2025 BT-SUMMARY instructions.

The DRA adjusts both thresholds for inflation every two years, rounding to the nearest $1,000, using the Northeast CPI. The $109,000 and $298,000 figures apply to taxable periods beginning on or after January 1, 2025, which covers calendar years 2025 and 2026 until the next adjustment.

Why "gross" is the word that catches people

The BPT threshold is measured on gross business income, not profit. The NH-1040 instructions define it as all business income for federal purposes "without any deduction" for cost of goods, labor, rent or other expenses. The BT-SUMMARY instructions say it plainly: even if there is no profit, a return must be filed when gross business income exceeds $109,000.

That means a Concord landscaper who brought in $130,000 and netted only $20,000 still files a BPT return. A Portsmouth Airbnb host with $115,000 of gross rents generally files too, because the definition of gross business income lists gross rents. The tax may come out to zero, but the return is still due.

The BET has a two-part test. If gross receipts from everywhere top $298,000, you file Form BET no matter what. If receipts are $298,000 or less, you add up dividends paid, compensation paid or accrued, and interest paid or accrued. If that total is over $298,000, you file anyway. Most small businesses under $298,000 in receipts also have a base under $298,000, so they file BPT only.

The owner compensation deduction, and how it feeds the BET

New Hampshire lets a proprietorship, partnership or LLC deduct reasonable compensation for the personal services its owner performs for the business (RSA 77-A:4, III; NH-1040 instructions, Line 6(b)). For an owner who does the actual work, this is usually the biggest number on the return.

A few rules from the 2025 instructions:

• If the deduction is more than $75,000, the business must keep records showing it's reasonable for the work done.
• It can't push taxable business profits below zero.
• If profits were too thin to take the full deduction in earlier years, you can adjust this year's deduction for that under-compensation, if your records show the intent.

Here's the catch most owners miss. The BET instructions (Line 2) say the compensation in the BET base includes "the amount of any compensation deduction taken under the Business Profits Tax." So every dollar you move out of BPT profit with the compensation deduction lands in the BET base instead. You trade a 7.5% tax for a 0.55% tax on that amount, which is still a good trade, but it can push a larger business over the $298,000 BET base test.

A worked example: two New Hampshire businesses

Example 1: a Manchester consultant, single-member LLC. Say you run a one-person IT consulting LLC in Manchester. For 2026 you bill $180,000 and have $40,000 of expenses, so federal net profit on Schedule C is $140,000.

• BPT: gross business income of $180,000 is over $109,000, so you file NH-1040.
• You take a reasonable compensation deduction of $95,000 for your own work. Because it's over $75,000, you keep a short memo with comparable market pay for your role.
• Taxable business profits: $140,000 minus $95,000 = $45,000. BPT at 7.5% = $3,375.
• BET: receipts of $180,000 are under $298,000. Your BET base is mainly the $95,000 compensation, with no interest or dividends paid, so it's under $298,000. No BET return.
• Total New Hampshire business tax: $3,375. Because that's over $200, you'll owe BPT estimates for 2027.

Example 2: a Nashua S corporation with employees. Now say a Nashua machine shop taxed as an S corporation has $1,200,000 of receipts, $400,000 of wages (including the owner's salary), $10,000 of interest on an equipment loan, and $150,000 of taxable business profits. New Hampshire taxes S corporations the same as C corporations at the entity level, so the shop files NH-1120.

• BET base: $400,000 + $10,000 = $410,000. BET at 0.55% = $2,255.
• BPT before credit: $150,000 x 7.5% = $11,250.
• The BET paid is allowed as a credit against BPT, so BPT after credit is $11,250 minus $2,255 = $8,995.
• Total paid to New Hampshire: $2,255 + $8,995 = $11,250.

The credit can't be more than the BPT itself. If BET is larger than BPT in a year, the unused BET credit carries forward for 10 taxable periods (for periods ending on or after December 31, 2014), so it isn't lost.

BT-SUMMARY: the cover form that makes the filing complete

Any business that must file a BPT or BET return also files Form BT-SUMMARY. It carries your name, address and signature, summarizes both taxes and shows payments. The DRA says failing to file it makes the business tax filing incomplete.

If you file BPT but not BET, check "No" in Step 2 of the BT-SUMMARY. The BET FAQ warns that if you don't, the Department assumes you were required to file a BET return. Proprietors must attach their federal schedules (C, D, E, F, 4797 and 6252 as they apply), and corporations attach the full federal return.

You can file and pay through Granite Tax Connect, the DRA's online portal, or by mail. Returns can't be faxed or emailed.

Due dates for 2026 returns and estimates

When the 15th falls on a weekend or legal holiday, the date moves to the next business day. Fiscal-year filers use the same month counts from the end of their own year.

Automatic extension. If you've paid 100% of the BPT and BET due by the original due date, you get an automatic 7-month extension to file, with no form needed. It's an extension to file, not to pay. If you need to top up a payment to reach 100%, pay online before midnight on the due date or send Form BT-EXT with the payment.

Estimate penalties. The estimate instructions say a penalty may apply if payments are less than 90% of the period's tax, or if they're late even when 90% is eventually paid. First-year businesses owe estimates too once the liability passes $200, though Form DP-2210/2220 may show an exception.

Common questions about New Hampshire business taxes

I'm a freelancer in Nashua with $95,000 of gross income. Do I file anything? Not for BPT or BET. You're under the $109,000 BPT threshold and well under $298,000 for BET. Keep tracking gross income, because one good year can put you over.

Does my single-member LLC file separately from me? The LLC is the business organization for BPT. A single-member LLC owned by an individual generally reports on NH-1040, the proprietorship return, using the federal Schedule C figures.

My S corp already pays me a salary. Do I also take the compensation deduction? Wages paid to a shareholder-employee are already deducted as wages. The reasonable compensation deduction on Line 6(b) is for proprietors, partners and members who aren't paid wages. Either way, the pay goes into the BET base.

Is the Interest and Dividends Tax gone for good? For periods beginning on or after January 1, 2025, yes. The 2024 tax year, at 3%, was the last one, and earlier years can still be audited.

I live in New Hampshire but my business is in Massachusetts. Which applies? BPT and BET apply to business activity in New Hampshire, apportioned by sales for multistate businesses. Massachusetts taxes business income earned there separately, so a cross-border business may file in both states.

What if I missed prior years? File the missing returns and pay the tax with interest, plus any penalties the DRA assesses. Catching up on your own before a notice arrives is usually the cheaper path.

This guide is general information based on the New Hampshire DRA FAQs and the 2025 BT-SUMMARY, NH-1040, BET and estimate instructions as of October 2026. Thresholds change every two years, so confirm the figures for your taxable period before filing.

Get the two-tax filing right every year

RKube Services handles bookkeeping and tax prep for small businesses across the US and Canada, including owners in Manchester, Nashua, Concord and Portsmouth. We track your gross business income against the $109,000 and $298,000 lines during the year, document a reasonable compensation deduction, and prepare the BPT, BET and BT-SUMMARY along with your federal return and the quarterly estimates. Start with a free scoping call and a 30-day trial: call (984) 234-7030 or visit rkubeservices.com.