How to Start a Business in Alexandria, Virginia
Why Alexandria Is One of Virginia’s Most Compelling Markets for New Businesses
Alexandria is an independent city — not part of Fairfax County or any other Virginia county — with a population of approximately 160,000 residents packed into 15.5 square miles. That density, combined with a highly educated and high-income workforce, creates a retail and service market that punches well above its size. Median household income consistently ranks among the highest in the nation, and the city’s daytime population expands considerably due to its proximity to the federal government, defense contractors, and major employers.
The economic anchors surrounding Alexandria are extraordinary. The Pentagon sits just across the city line in Arlington. Fort Belvoir lies to the south. The Mark Center defense campus operates within city limits. Amazon HQ2 in Crystal City/National Landing is effectively a neighbor across the Potomac. These installations and campuses generate enormous demand for restaurants, retail, professional services, logistics, and hospitality.
Old Town Alexandria along King Street is one of the most visited historic commercial corridors on the East Coast. The Torpedo Factory Art Center draws hundreds of thousands of visitors annually. Four Washington Metro stations serve the city — King Street, Braddock Road, Eisenhower Avenue, and Van Dorn Street — connecting Alexandria residents and workers to the full DC regional labor pool.
The Alexandria Economic Development Partnership (AEDP) serves as the city’s official economic development agency. Their website at alexandriaecon.org provides market data, available properties, and direct assistance for businesses considering a move or expansion into the city.
Understanding Alexandria’s Status as an Independent City
This distinction matters enormously for licensing and taxation. When you start a business in Alexandria, you deal exclusively with Alexandria city agencies — not Fairfax County, not Arlington County, not any other jurisdiction. The city has its own tax administration, its own courts, its own zoning, and its own business license system.
Alexandria’s FIPS code is 51510. You will use this code when registering with the Virginia Department of Taxation on Form R-1. Do not use a Fairfax County or Arlington County FIPS code even if your address shares a zip code with those jurisdictions.
Several Alexandria zip codes are split between the city and neighboring jurisdictions:
- 22302, 22304, 22311, 22312 — split between Fairfax County and the City of Alexandria
- 22206 — split between Arlington County and the City of Alexandria
If your business address falls in one of these zip codes, confirm which jurisdiction you are actually in before filing anything. Filing in the wrong jurisdiction creates duplicate tax obligations and penalties that are difficult to unwind.
Step 1: Choose and Register Your Business Structure
Virginia business entities are registered with the State Corporation Commission (SCC) through the online portal at cis.scc.virginia.gov.
Filing fees:
- LLC: $100
- Corporation: $75
- Trade name (DBA): $10
Most small businesses choose an LLC for the combination of liability protection and pass-through taxation. Sole proprietors and general partnerships operating under a name other than the owner’s legal name must file a trade name certificate.
Your SCC registration establishes your legal right to operate under your chosen name in Virginia. Keep your confirmation and registered agent information — you will need these when applying for your Alexandria business license.
Step 2: Obtain a Federal Employer Identification Number
An EIN is free and obtained directly from the IRS at irs.gov/ein. The online application issues your EIN immediately upon completion. You need an EIN to open a business bank account, hire employees, file taxes, and complete Alexandria’s business license application for entities with multiple owners or employees.
Step 3: Register with Virginia Department of Taxation
Use Form R-1 to register your business with the Virginia Department of Taxation. Enter FIPS code 51510 to designate Alexandria as your locality. This registration establishes your accounts for income tax withholding, sales and use tax collection, and other state-administered taxes.
Alexandria’s combined sales tax rate is 6% — composed of 4.3% state, 0.7% local option, and 1% Northern Virginia Transportation Authority (NVTA) regional tax. This is higher than the statewide 5.3% base because Alexandria sits within the Northern Virginia region subject to the NVTA tax.
Step 4: Address Zoning and Local Permits
Before committing to a physical location, verify that your intended business use is permitted at that address. Alexandria’s Department of Planning & Zoning handles zoning verification and use permits. The city is dense and walkable with detailed zoning regulations, particularly in the Old Town Historic District.
If you locate in Old Town or any designated historic district, additional approvals from the Board of Architectural Review may be required for exterior signage, storefront modifications, or structural changes. Build this review time into your launch timeline — it can add weeks or months to a project.
Home-based businesses require that the home occupation not change the residential character of the property. Client visits, employees, and signage are typically restricted. Check with Planning & Zoning before assuming your home occupation is unrestricted.
Step 5: Obtain State and Professional Licenses
Many professions require state licensing through the Virginia Department of Professional and Occupational Regulation (DPOR) before they can operate. DPOR covers contractors, real estate agents, engineers, architects, cosmetologists, home inspectors, and dozens of other regulated occupations. Check dpor.virginia.gov for your specific license type before opening.
Other regulatory touch points depending on business type:
- Food service: Alexandria Health Department permits and facility inspections
- Alcohol: Virginia Alcoholic Beverage Control Authority (ABC)
- Childcare: Virginia Department of Social Services
- Healthcare: Multiple state boards depending on discipline
Step 6: File Your Alexandria Business License (BPOL) — File Immediately
This is the most time-sensitive step for new Alexandria businesses. New businesses must file and pay their business license immediately — there is no grace period.
Alexandria’s business license operates under the Business, Professional, and Occupational License (BPOL) tax system. The tax is calculated on gross receipts without any deductions. You cannot deduct cost of goods sold, materials, labor, services purchased, interest paid, or discounts given. BPOL applies to the full gross revenue amount.
You must consistently apply either cash or accrual basis accounting, and your method must match what you report on your federal tax return.
The Department of Finance, Revenue Administration Division
Two office locations:
- 301 King Street, Suite 1700, Alexandria, VA 22314
- 4850 Mark Center Drive, Suite 2011, Alexandria, VA 22311
Office hours: Monday through Friday, 8:00 AM to 5:00 PM
Email: [email protected]
Mailing address: P.O. Box 178, Alexandria, VA 22313
Online portal: businesstaxportal.alexandriava.gov
Application Requirements
Download the business license application from alexandriava.gov Tax Forms. The application requires:
- LLC members: Name and Social Security Number for each member
- Corporation: Registered agent information
- Partnership: All partners listed on a separate sheet attached to the application
For new businesses with no prior gross receipts history, estimate your first year’s gross receipts when applying. You will reconcile this estimate against actual gross receipts at renewal time.
Fees and Rates
The minimum BPOL fee is $50 for businesses under $100,000 in gross receipts. For businesses above that threshold, the rate depends on your business classification. Retail, professional services, contracting, financial services, and other categories each carry different rates per $100 of gross receipts.
Failure to File: Statutory Assessment
If you fail to file your BPOL return on time, the city will issue a statutory assessment:
- If the city has your prior year’s history: the statutory assessment is set at 15% above the previous year’s license amount
- If the city has no prior history: the assessment is based on a comparable business estimate
These assessments carry additional interest and penalties. Given that Alexandria has no grace period for new businesses, file on the day you open.
Online Portal
The business tax portal at businesstaxportal.alexandriava.gov allows online filing and payment. New accounts require a one-time PIN originally distributed by mail starting April 2019. Contact the Revenue Administration Division to obtain portal access if you do not have a PIN.
Step 7: Transferring an Existing Alexandria Business License
If you are purchasing an existing Alexandria business, the prior owner’s license does not transfer automatically. You must submit a notarized Request for Transfer form along with the purchase agreement to the Revenue Administration Division. The form requires notarization, so build time into your acquisition closing process.
Shared Zip Code Warning: Confirm Your Jurisdiction
If your business address is in zip codes 22302, 22304, 22311, 22312, or 22206, affirmatively confirm whether you are in the City of Alexandria or in Fairfax County or Arlington County before filing any forms. Use the city’s online GIS property lookup, or contact the Revenue Administration Division at [email protected] with your address.
Operating in Alexandria but filing with Fairfax County (or vice versa) creates a double-payment problem and audit exposure. This is a common mistake in these zip codes and is completely avoidable.
BPOL and COVID-19 Exclusions
Under Va. Code § 58.1-3732(A)(4), the following are excluded from Alexandria gross receipts for BPOL purposes:
- EIDL (Economic Injury Disaster Loans)
- PPP (Paycheck Protection Program) loans and grants
- AEDP B2B grants
If you received any of these and included them in gross receipts in a prior period, consult a tax professional about amended returns.
Existing Business Renewals
Existing Alexandria businesses renew BPOL licenses with a March 1 deadline each year. Renewals are filed through the business tax portal or by paper to P.O. Box 178. The renewal is based on the prior calendar year’s actual gross receipts.
Resources for Alexandria Small Business Owners
Alexandria Economic Development Partnership (AEDP) alexandriaecon.org — site selection assistance, demographic data, introductions to city officials, and connections to financing programs.
Small Business Development Center (SBDC) The Northern Virginia SBDC network offers free one-on-one consulting, business planning workshops, and loan packaging assistance funded through the SBA.
SCORE The Northern Virginia SCORE chapter provides free mentoring from experienced business executives to Alexandria-area small business owners.
Ongoing Compliance After Opening
Key ongoing obligations for Alexandria businesses:
- BPOL renewal: annually by March 1 based on prior year gross receipts
- Business Personal Property Tax: due May 1 on furniture, fixtures, equipment, and other tangible property used in your business
- Meals Tax: collected from customers and remitted monthly if you operate a food service establishment
- Lodging Tax: applies to short-term rentals and hotels/motels
- State income tax withholding: remitted to Virginia Department of Taxation on the schedule matching your withholding volume
- SCC annual registration: LLC annual fees and corporation annual report fees paid to the SCC to maintain good standing
Alexandria Business Formation Checklist
- Register business entity with Virginia SCC at cis.scc.virginia.gov — $100 LLC, $75 corp, $10 trade name
- Obtain EIN from irs.gov/ein (free)
- Register with Virginia Department of Taxation on Form R-1 using FIPS code 51510
- Verify your address is in City of Alexandria if your zip code is 22302, 22304, 22311, 22312, or 22206
- Confirm zoning and obtain use permits from Department of Planning & Zoning
- Obtain required professional licenses from DPOR or other state agencies
- File BPOL business license application immediately upon opening — no grace period
- Set up online portal access at businesstaxportal.alexandriava.gov
- Comply with ongoing BPOL renewal (March 1), personal property tax (May 1), and trust tax remittance obligations
Questions about your specific business situation can be directed to the Alexandria Revenue Administration Division at [email protected] or by visiting either office location during the 8:00 AM to 5:00 PM Monday through Friday business hours.