Delaware Franchise Tax: Due Dates, Calculation & Pay

If you formed in Delaware—because investors prefer it, counsel recommended it, or you plan to franchise—Delaware franchise tax is the annual fee that keeps your company in good standing.

This guide answers the exact searches owners make: when is Delaware franchise tax due, how to calculate Delaware franchise tax, and how to pay Delaware franchise tax—with clear examples and a few cash-saving moves.

What the tax actually is (and who pays it)

Delaware charges most business entities an annual franchise tax:

• Corporations must file an Annual Report and pay franchise tax by March 1 for the prior year (online only). Late filings trigger a $200 penalty plus 1.5% interest per month on the tax and penalty.
• LLCs/LPs/GPs don’t file an annual report, but they owe a flat $300 tax by June 1. Same $200 penalty + 1.5% monthly interest if late.
• Foreign corporations (formed elsewhere but registered in DE) file an Annual Report by June 30 and pay a separate fee.

Keep “good standing” clean. Banks, buyers, and state agencies will ask for good-standing certificates—and Delaware won’t issue them if you’ve missed filings or tax.

When are Delaware franchise taxes due?

• Domestic corporations: March 1 (report + tax, online).
• LLCs/LPs/GPs: June 1 ($300 flat tax).
• Foreign corporations: June 30 (annual report + fee).

If your corporate franchise tax will be $5,000+, Delaware requires estimated payments: 40% due June 1, 20% Sept 1, 20% Dec 1, and the balance by March 1 with your Annual Report. Put those dates on the same finance calendar you use for payroll taxes and sales tax.

How to calculate Delaware corporate franchise tax (choose the cheaper method)

Delaware lets corporations file under one of two methods—you can pick the lesser tax each year.

1) Authorized Shares Method (simple; tied to authorized shares)

• Minimum tax: $175 (≤5,000 authorized shares).
• 5,001–10,000 shares → $250; each additional 10,000 (or portion) adds $85.
• Maximum: $200,000 (or $250,000 if designated a Large Corporate Filer).

When it fits: You authorized a modest number of shares at formation and never “over-authorized.”

Quick mental math: 100,000 authorized shares ≈ $1,015 (=$250 + 9×$85).

2) Assumed Par Value Capital Method (great for “high shares, modest assets”)

• Works from total assets (from Form 1120, Schedule L) and issued shares, not just authorized.
• Rate: $400 per $1,000,000 (or part) of “assumed par value capital.”
• Minimum tax: $400.

When it fits: You authorized a large pool of shares “just in case,” but your issued shares and assets are still low—common in early-stage or capital-light companies. Delaware’s calculator page explains the steps and examples; you’ll plug in total assets and issued shares from your books to compute the base.

How to pick the method in practice (5-minute workflow)

1. Pull two numbers from your year-end financials: total assets (1120 Schedule L “total assets”) and issued shares.
2. Run both methods in your working paper (or Delaware’s estimator) and compare. If your authorized share count is high, the Assumed Par Value method usually wins—even with the $400 minimum.
3. Document your choice in the controller’s checklist so next year’s filing is faster and consistent.

Owner tip: If you wildly over-authorized shares at formation, talk to counsel about right-sizing. It’s a corporate legal step—not a tax filing—but it can lower future franchise tax using the Authorized Shares method.

How to pay Delaware franchise tax (and file the report)

Everything happens online on the Delaware Division of Corporations portal. You’ll see two primary buttons: “File Annual Franchise Tax Report / Pay Taxes” (for corporations) and “Pay LLC/LP/GP Tax” (for alternative entities). The application is generally available 8:00 a.m.–11:45 p.m. Eastern daily.

Payment options

• ACH debit or credit card (Visa/Mastercard/Amex/Discover); ACH is required for transactions over $5,000.

What to gather before you start

• Corporations: officer/director info, principal address, authorized & issued share counts, and (if using Assumed Par Value) total assets from your 1120 Schedule L.
• LLCs/LPs/GPs: legal name/EIN/registered agent details (no report to file—just pay the $300).

Common mistakes (and quick fixes)

• Missing the date. Corporations are due March 1; LLC/LP/GPs are due June 1; foreign corps report June 30. Late = $200 penalty + 1.5% per month interest. Calendar 30/14/7-day reminders.
• Picking the wrong method. If you have lots of authorized shares but relatively low issued shares/assets, the Assumed Par Value method often produces a lower bill (even with the $400 minimum). Run both.
• Forgetting estimated payments. If your corporate franchise tax will exceed $5,000, schedule 40%/20%/20%/balance to avoid a March cash crunch.
• Paying by card when the amount is >$5,000. ACH is required—don’t get stuck at checkout.
• Confusing Delaware franchise tax with state/federal income tax. Separate obligations, separate calendars.

FAQ

When is Delaware franchise tax due?

Corporations: March 1 (with the Annual Report). LLCs/LPs/GPs: June 1 ($300). Foreign corporations: June 30 report.

How to calculate Delaware franchise tax?

Corporations choose Authorized Shares (min $175) or Assumed Par Value (min $400 at $400 per $1M or part). Use the lower result. Caps: $200,000 (or $250,000 for Large Corporate Filers).

How to pay Delaware franchise tax?

Use the Delaware portal; ACH or card (but ACH required >$5,000). Corporate filings are online only; LLCs just pay the $300.

What if I’m late?

$200 penalty plus 1.5% interest per month on the tax and penalty until paid—good standing is affected.

A practical checklist you can paste into your close file

• Add Mar 1 / Jun 1 / Jun 30 to your compliance calendar (with 30/14/7-day reminders).
• Corporations: run both methods (Authorized Shares vs Assumed Par Value) and file using the cheaper one; attach your workpaper.
• If tax > $5,000: set 40%/20%/20%/balance estimates (Jun 1 / Sep 1 / Dec 1 / Mar 1).
• Use ACH for payments over $5,000; enroll the CFO/controller as a portal user.
• Order a Good Standing Certificate after filing—file it with your lender and franchise agreements.

Where QMK Consulting fits in

QMK Consulting is an accounting firm in New York City, specialized in franchise accounting and restaurant accounting (serving clients nationwide). We help you:

• Pick the cheapest valid method each year and prepare the Schedule L / issued shares support.
• File the Annual Report correctly and keep good standing clean for banking and deals.
• Build a compliance calendar (with estimates if you’re over $5k) that won’t choke cash going into peak season.

Book Profit & Cash Flow Analysis

Want a quick, numbers-first look at your Delaware corporate franchise tax exposure—with a plan to minimize it and avoid penalties?

Get your free profit & cash flow analysis by our experts and leave with (1) the right calculation method, (2) a filing checklist, and (3) a calendar that protects cash all year.

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Educational only—not tax or legal advice. Always confirm details with Delaware’s official guidance.