How to Start a Business in Petersburg, Virginia
Petersburg is in the middle of a generational reinvention. The city sits at the junction of I-95 and I-85, 23 miles south of Richmond, in a position that has strategic value for any business needing north-south access along the Eastern Seaboard. After years of fiscal and infrastructure challenges, Petersburg has attracted significant state investment through the Partnership for Petersburg — a 2022 initiative launched under Governor Youngkin with 42 initiatives across 61 organizations, targeting education, public safety, health, and economic development.
In 2024, the city earned Advancing Virginia Main Street (AVMS) designation through the Virginia Department of Housing and Community Development, a recognition that signals downtown revitalization momentum. More than 1,600 new apartment units have been developed downtown over the past 20 years, growing the residential base. Virginia State University, an HBCU located just south of the city, provides a workforce pipeline.
For entrepreneurs, the value proposition is real: a strategic I-95/I-85 location, proximity to the Richmond metro, low property costs compared to Chesterfield and Henrico, and a city government actively courting new investment. The business tangible personal property tax rate — $4.90 per $100 of assessed value — is one of the highest in Virginia and a real ongoing cost to factor in. This guide covers everything you need to start a business here honestly.
Why Petersburg for Your Business
Population and location: Petersburg had a population of approximately 33,458 (2020 census). The city is an independent municipality in south-central Virginia, at the junction of I-95 and I-85, 23 miles south of Richmond.
Metro access: Petersburg is part of the Richmond-Petersburg Metropolitan Statistical Area, giving businesses access to the broader Richmond metro economy — the state capital, major healthcare systems (VCU Health, HCA Virginia), and a large professional workforce.
Critical jurisdictional note: Petersburg is an independent city, separate from its surrounding counties: Dinwiddie County to the west and south, Prince George County to the east, and Colonial Heights to the south (another independent city). Each jurisdiction has its own Commissioner of the Revenue and its own licensing process. Verify your business address is inside Petersburg city limits before filing.
The Partnership for Petersburg: Launched in 2022, this state-city collaboration represents the most significant investment in Petersburg’s future in decades. The initiative spans 42 initiatives across 61 participating organizations, addressing public safety, health, education, and economic development. For businesses, the Partnership signals that Petersburg has state backing for its revitalization — not just local willpower.
Advancing Virginia Main Street (AVMS): Petersburg earned this designation through the Virginia Department of Housing and Community Development in 2024. AVMS communities receive technical assistance, training, and resources for downtown commercial district revitalization. It’s a marker of momentum.
Main Street Petersburg (MSP): A nonprofit driving tourism, arts, dining, entertainment, and neighborhood amenities downtown. Active advocate for new businesses in the commercial district.
Downtown development: More than 1,600 new apartment units developed in the central city over the past 20 years. A growing residential base means more local customers, more demand for neighborhood services, and more foot traffic.
Virginia State University (VSU): An HBCU located just south of Petersburg with approximately 4,500–5,000 students. VSU is a workforce development partner, a community anchor, and a source of entrepreneurial talent. The VSU Small Business Development Center works with local entrepreneurs.
Fort Barfoot (formerly Fort Lee): A major U.S. Army installation in neighboring Prince George County. Military-adjacent businesses — logistics, housing, food service, professional services — have a substantial customer base nearby.
Historic significance: Petersburg National Battlefield (a Civil War site), the Appomattox River, and extensive historic architecture from colonial through early 20th century create a tourism infrastructure that supports hospitality and cultural businesses.
Economic Development: 30 Franklin Street, 3rd Floor, Petersburg, VA 23803
Cost advantage: Property costs in Petersburg are significantly lower than in Chesterfield County, Henrico County, or the city of Richmond proper. For businesses with physical space needs — retail, light manufacturing, storage — the cost differential can be substantial.
Tax environment: No city income tax. Virginia flat 6% corporate income tax. Right-to-work state.
Choose Your Business Structure
Your legal structure determines liability exposure, tax treatment, and state registration requirements. Choose before applying for your Petersburg business license.
Limited Liability Company (LLC) The most common structure for small businesses in Virginia. Provides personal liability protection while avoiding corporate double taxation.
- Filing fee: $100 with the Virginia State Corporation Commission (SCC)
- Annual registration fee: $50 per year
- File at: cis.scc.virginia.gov (online, 1–2 business days standard processing)
Sole Proprietorship No SCC filing required unless you operate under a trade name (not your legal personal name). Trade name registration: $10 with the SCC.
Corporation
- Articles of Incorporation: $75 with the SCC
- Additional ongoing compliance requirements compared to an LLC
S-Corporation Election A federal tax classification, not a state structure. File IRS Form 2553 after forming your LLC or corporation with the SCC.
Register with the State
After forming your entity, register for applicable state taxes.
Virginia SCC Clerk’s Information System (CIS) cis.scc.virginia.gov — Formation and management of your LLC, corporation, or other entity.
Virginia Department of Taxation tax.virginia.gov — Register for:
- Sales and use tax (if you sell taxable goods or certain services)
- Employer income tax withholding (if you have employees)
- Corporate income tax (if operating as a corporation)
Sales tax rate in Petersburg: 5.3% — composed of 4.3% state rate plus 1% local rate. Petersburg is in the standard-rate zone, not the Northern Virginia Transportation Authority region.
Federal Employer Identification Number (EIN): Apply free at irs.gov/ein. Required for multi-member LLCs, corporations, and any business with employees.
Get Your Petersburg Business License
Petersburg requires a business license from the Commissioner of the Revenue before you begin conducting business.
Commissioner of the Revenue Brittany C. Flowers, Master Commissioner 144 North Sycamore Street Petersburg, VA 23803 Phone: (804) 733-2315 Fax: (804) 508-6948 Email: [email protected] Hours: Monday – Friday, 8:00 AM – 5:00 PM
You must obtain your license BEFORE conducting business. Petersburg enforces this requirement — operating without a license can result in back taxes, penalties, and interest on the full period you were unlicensed.
BPOL tax: The Petersburg business license tax is based on gross receipts. Tax rates vary by business category following Virginia Code classifications. Contact the Commissioner’s office at (804) 733-2315 or [email protected] for the rate applicable to your specific business type.
Prerequisites by Business Type
Petersburg has an unusually detailed and explicit list of prerequisites that must be satisfied before the Commissioner will issue your license. This is non-negotiable — have your documentation ready.
All commercial locations:
- Building inspection or fire inspection clearance for your business location
Food businesses:
- Health Department permit from the Crater Health District
Corporations and LLCs:
- Virginia SCC certification of formation
All businesses:
- Federal EIN from IRS
Contractors:
- Copy of Virginia DPOR Class A, B, or C contractor’s license
Beauticians and barbers:
- Copy of state cosmetology or barber license
Salon owners:
- Copy of state salon license
Medical professionals:
- State medical license
Attorneys:
- Virginia State Bar license
Real estate brokers:
- State realtor card
Daycare centers, adult homes, group homes:
- License from the Virginia Department of Social Services
Car dealerships:
- DMV certificate
Alcohol sales:
- Virginia ABC license from the Virginia Alcoholic Beverage Control Authority
Gather all applicable documentation before you visit the Commissioner’s office. Walking in without required certifications will delay your license. The Commissioner’s team is responsive by email if you have questions about what applies to your specific business type.
Additional Taxes — The Personal Property Rate
Petersburg’s business tangible personal property tax is one of the most significant cost differentials between Petersburg and other Virginia cities. Plan for it from the start.
Business tangible personal property tax: $4.90 per $100 of assessed value. This is one of the highest rates in Virginia. By comparison, Richmond charges $3.70, Roanoke charges $3.45, and many suburban jurisdictions charge $3.00–$3.50.
What’s taxable: All business equipment, furniture, fixtures, computers, vehicles, and other tangible property used in your business. Even fully depreciated items that have zero book value must be reported if they’re still in use.
Machinery and tools (manufacturing and processing operations): $3.80 per $100.
Example calculation: If your business has $50,000 in assessed business equipment value, your annual personal property tax is: $50,000 ÷ 100 × $4.90 = $2,450 per year. A business with $100,000 in equipment pays $4,900 annually.
This is a separate tax from your business license — filed and paid separately with the Commissioner.
Real estate tax: $1.27 per $100 of assessed value, if your business owns its property.
Meals and lodging taxes: Register with the Commissioner if your business involves prepared food service or transient accommodations.
Business Resources in Petersburg
Petersburg Economic Development 30 Franklin Street, 3rd Floor, Petersburg, VA 23803 The city’s economic development office provides site selection assistance, information on available incentives (including the rehabilitation tax exemption for qualifying property improvements), and connections to state programs.
Main Street Petersburg (MSP) The downtown revitalization nonprofit. Active programming around tourism, arts, dining, and entertainment. A useful network for businesses locating in the commercial district.
Petersburg Area Regional Chamber (PARC) Regional business network covering Petersburg and surrounding communities.
Virginia State University — Small Business Development Center Free consulting available through the VSU SBDC partnership. Business planning, financial projections, loan packaging, and market research.
SBDC Network (Virginia SBDC) Free, confidential consulting at no charge to the business owner. See virginiasbdc.org for the nearest advisor.
SCORE Free mentoring from retired executives matched to your industry.
Virginia Business One Stop business.virginia.gov — Central portal for state registration, tax registration, and business licensing.
Economic Incentives
Rehabilitation tax exemption: Petersburg offers a tax exemption for qualifying improvements to certain properties. Contact the City Assessor’s Office for eligibility requirements and application details. This is particularly relevant for businesses renovating historic downtown properties.
Enterprise Zone potential: Check with Economic Development at 30 Franklin Street for current Enterprise Zone designations and whether your business location qualifies for state or local incentives.
Partnership for Petersburg: State resources for workforce development and public safety improvements flowing through this initiative may benefit businesses hiring locally or investing in the city.
Special Considerations by Business Type
Food and restaurant businesses: Petersburg’s downtown revitalization has included growth in dining and hospitality. All food establishments require a permit from the Crater Health District (the health authority serving Petersburg) before opening. Register for the meals tax with the Commissioner when you file your BPOL application.
Short-term rentals: Petersburg’s historic architecture and growing residential base create short-term rental opportunity, particularly for visitors to the Petersburg National Battlefield and the Appomattox Court House National Historical Park. Short-term rental hosts must register for the lodging tax and confirm that their property’s zoning permits rental use.
Contractors and trades: Fort Barfoot (formerly Fort Lee) in neighboring Prince George County creates significant contracting demand — military facilities, residential construction for military families, maintenance services. Virginia DPOR contractor’s license (Class A, B, or C) required. Provide a copy when applying for your Petersburg license.
Healthcare: Virginia State University’s health programs and the region’s healthcare needs create demand for healthcare professionals and allied health services. Medical professionals, therapists, and healthcare facility operators must provide applicable state licenses to the Commissioner before a BPOL license is issued.
Professional services: Attorneys, accountants, consultants, and real estate professionals serving the Richmond-Petersburg corridor operate from Petersburg at property costs well below Richmond proper. Virginia State Bar license (for attorneys) and applicable professional credentials must accompany the BPOL application.
Manufacturing and light industrial: Petersburg has existing industrial infrastructure from its manufacturing history. The machinery and tools tax rate of $3.80/$100 is the applicable personal property rate for manufacturing equipment — lower than the standard $4.90/$100 equipment rate, but still among the higher rates in Virginia.
The Process from Start to Finish
- Choose your business structure and register with the Virginia SCC at cis.scc.virginia.gov ($100 for LLC, $75 for corporation)
- Obtain your federal EIN at irs.gov/ein
- Register with the Virginia Department of Taxation at tax.virginia.gov for sales tax, employer withholding, and corporate income tax
- Gather all prerequisite documentation — building inspection clearance, health permits, state licenses, and certifications required for your business type (see the prerequisites section above)
- Email the Commissioner ahead of time at [email protected] to confirm exactly which prerequisites apply to your specific business
- Apply for your Petersburg business license in person at 144 North Sycamore Street with all documentation in hand — you must have the license before conducting business
- Register for applicable excise taxes (meals, lodging) at the time of your license application
- If hiring employees: obtain workers’ compensation coverage and register with the Virginia Employment Commission
- Plan for the $4.90/$100 annual personal property tax — file your business tangible personal property return with the Commissioner on the required schedule and pay the Treasurer by the due date
- Renew your license annually based on prior-year actual gross receipts
The prerequisite documentation is the key preparation step. Petersburg is transparent about what each business type needs — use that clarity to your advantage and arrive at the Commissioner’s office with everything ready.
Contact Summary
Commissioner of the Revenue Phone: (804) 733-2315 Fax: (804) 508-6948 Email: [email protected] Address: 144 North Sycamore Street, Petersburg, VA 23803 Hours: Monday – Friday, 8:00 AM – 5:00 PM
Economic Development 30 Franklin Street, 3rd Floor, Petersburg, VA 23803
Main Street Petersburg (MSP) Downtown revitalization nonprofit
Petersburg Area Regional Chamber (PARC) Regional business network
SBDC and SCORE: Free resources — see virginiasbdc.org
The Bottom Line
Petersburg’s value proposition for entrepreneurs is real: I-95/I-85 location, low property costs, proximity to Richmond, and a city government that is actively — with state support — working to improve conditions for business. The Partnership for Petersburg and the Main Street designation are not just branding; they represent concrete investment and infrastructure improvement.
The cost reality is equally real: the $4.90/$100 business tangible personal property rate is among the highest in Virginia. If your business depends on significant equipment, machinery, or physical assets, that rate will be a meaningful annual line item. Factor it into your projections from year one.
The prerequisites list is detailed but transparent — Petersburg tells you exactly what documentation each business type needs. That clarity helps you prepare before you show up at the Commissioner’s office.
For LLC formation: How to Start an LLC in Virginia. For BPOL context statewide: Virginia Business License Guide.