New Hampshire Tax Rates

This post provides an overview of the primary taxes levied at the state level in New Hampshire. The state is renowned for its low-tax environment, lacking both a general sales tax and a tax on earned wages. However, it relies heavily on property taxes. For individuals or businesses seeking comprehensive support with tax filings, compliance, or strategic planning, indinero offers expert services. We encourage all who utilize this summary to explore the tailored tax support available through indinero.

Individual Income Tax

New Hampshire is one of a handful of states that does not impose an individual income tax on wages or salaries.

  • Tax on Wages: The state income tax rate on wages and salaries is a flat 0.0%.
  • Interest & Dividends Tax (Repealed): The state historically imposed an Interest and Dividends Tax (I&D Tax) on unearned income above an exemption threshold. However, this tax is fully repealed for tax years beginning after December 31, 2024.
    • For example, if you are filing your 2024 return in 2025, the rate is 3.0%, but for all income earned in 2025 and beyond, it is 0%.
  • Retirement Income: Since the I&D tax is repealed, all retirement income, including Social Security benefits, pensions, 401(k) withdrawals, and IRA distributions, will generally not be subject to state tax.

Sales and Use Tax

New Hampshire is famous for being one of the few states that does not impose a general sales tax.

  • State and Local Sales Tax: The general state and local sales tax rate is 0.0%.
  • Exceptions (Specific Excise Taxes): While there is no general sales tax, the state does levy specific taxes on certain transactions, often categorized as excise taxes:
    • Meals and Rentals Tax: A rate of 8.5% is levied on prepared food (restaurant meals) and transient rentals (hotel and motel rooms).
    • Motor Vehicle Rentals: A tax of 9% is levied on short-term motor vehicle rentals.
    • Tobacco and Fuel: Specific excise taxes are levied on cigarettes ($1.78 per pack) and gasoline (23.83 cents per gallon).

Property Tax (Ad Valorem Tax)

Property taxes in New Hampshire are collected exclusively at the local level by municipalities, and they are the primary source of revenue for local services and schools. Consequently, New Hampshire has one of the highest effective property tax rates in the U.S.

  • Assessment: Property is assessed at its full and fair market value.
  • Tax Calculation: The tax owed is calculated by applying the local mill rate (set by town and school district budgets) to the assessed value.
  • State Education Property Tax: The state imposes a Statewide Education Property Tax (SWEPT) on all taxable property, but this tax is administered and collected locally and is often credited back against local education spending.
  • Tax Relief: The state offers a Homestead Food Tax Relief program and an optional Elderly Exemption that municipalities can adopt.

Corporate and Business Taxes

New Hampshire imposes two key taxes on businesses: the Business Profits Tax (BPT) and the Business Enterprise Tax (BET).

1. Business Profits Tax (BPT)

The BPT is a corporate income tax imposed on a business’s net income.

  • Tax Rate: The BPT rate is a flat 7.5% (effective for tax periods ending on or after December 31, 2023).
  • Apportionment: For multi-state businesses, income is apportioned using a single sales factor method.

2. Business Enterprise Tax (BET)

The BET is a second tax imposed on the enterprise value of the business.

  • Tax Base: The tax is levied on the sum of all compensation paid, interest paid, and dividends paid by the business enterprise.
  • Tax Rate: The BET rate is 0.55% (effective for tax periods ending on or after December 31, 2022).
  • Credit: Any BET paid may be claimed as a credit against the BPT, preventing true double taxation.

Unique and Miscellaneous Taxes

  • No Estate or Inheritance Tax: New Hampshire does not impose a state-level estate tax or inheritance tax.
  • Real Estate Transfer Tax: The state imposes a tax on the transfer of real property, which is shared between the state and the municipality.

R&D Offer Quiz

Step 1 of 3

Answer to find out if you're eligible for R&D tax credits.

Do the activities performed relate to a new or improved business component’s function, performance, reliability, quality, or composition?(Required)
For Example: A mid-sized packaging company develops a slightly modified cardboard box design to improve its stacking strength (reliability) for warehouse storage, involving minor adjustments to the corrugation pattern to reduce collapse under standard weight loads.
Is your company trying to discover information to eliminate uncertainty concerning the capability or method for developing or improving a business component?(Required)
For Example: A furniture manufacturer investigates whether a cheaper wood adhesive can hold joints as effectively as the current one during assembly, testing bond strength to resolve doubts about its capability in standard production lines.
Do the activities performed constitute a process of experimentation?(Required)
For Example: An auto parts supplier runs a series of bench tests on different lubricant formulations to find one that reduces friction in engine bearings more effectively, systematically comparing wear rates over simulated operating cycles.