Cost of Doing Business

COST OF DOING BUSINESS

Allen is a pro-business community in a pro-business state

With no personal income tax and no corporate income tax, Allen offers a lower cost of doing business.

Top 10 Best State

in the Tax Foundation’s 2015 State Business Tax Index

Quick Links

Click the links below to learn more.

Tax Basics

Property Taxes

Tangible property is subject to local taxation in Texas, and is appraised and assessed at 100% fair market value. Property subject to taxes are divided into two categories: real and personal property. Personal property is defined as “all movable items not permanently affixed to or a part of the real estate”. Real property is any property that is not personal property.

Real property is appraised by the Collin County Appraisal District, For personal property, businesses provide the appraisal district with the fair market value each year. The property is then depreciated according to the county’s depreciation schedule.

Property tax rates (per $100 valuation):

City of Allen $0.5200
Allen ISD $1.5900
Collin County $0.208395
Collin College $0.081222
TOTAL $2.399617

While not reflected here, it should be noted that strong growth has allowed these entities to lower the property tax rate by 12.9% over the last 10 years. In addition, property tax abatements can lower a project’s property tax obligations for up to 10 years.

Sales & Use Tax

A sales and use tax of 8.25 percent on all retail sales, leases, and rentals of most goods, as well as taxable services. (However, food items are exempt from sales tax.)

Exemptions are available for qualifying manufacturing operations and data centers.

Sales and use tax rates

State 6.25%
City 2.00%
TOTAL 8.25%

Franchise Tax

The Franchise tax is imposed by the state on entities doing business in Texas and is based on the margin of the company. The State Comptroller has an excellent guide that explains this tax here.

Franchise tax rates

  • 0.75% for most entities
  • 0.375% for qualifying wholesalers and retailers
  • 0.331% for certain entities with $20 million or less in total revenue

Tax Resources

These links will provide basic information about the different types of taxes in Texas.

Unemployment Insurance

Unemployment Insurance is charged on most businesses employing at least one person.

More information can be found at the Texas Workforce Commission.

Worker’s Compensation

Workers’ compensation insurance is a state regulated insurance system that ensures medical bills and some lost wages are paid for employees injured on the job or who have work-related diseases or illnesses.

Learn more at the Texas Department of Insurance.