How to Start a Cleaning Business in Virginia: No State License, BPOL 36 Cent Cap and Sales Tax on Services

Here is what the cap means in practice. At the state ceiling, $150,000 in gross receipts would produce a maximum of $540 ($150,000 divided by $100, times 36 cents). Your locality may charge less, set a different rule, or have no general license at all.

When you call the Commissioner of the Revenue, ask four things: the rate and classification for your work, the filing deadline, whether your receipts fall under the floor or a waiver, and whether home-occupation zoning rules apply if you run the business from your house. Zoning rules are a separate question from the tax and come from your locality's planning or zoning office.

Step 3: Know Where Cleaning Becomes Contracting or Health Work

For ordinary cleaning, the rules are simple. Window cleaning, carpet cleaning and regular house and office cleaning have no state license of their own that we know of. The trouble starts when the job changes character.

• Contracting. The definition of contractor (Va. Code 54.1-1100) can reach remediation, cleanup or containment of contaminants in a building. Cleaning that is incidental to construction or repair is exempt (Va. Code 54.1-1101, subdivision 13). Before you take post-construction, mold, fire, flood or biohazard jobs, ask DPOR whether a license is needed. If one is, contractor license classes since 2025-07-01 are Class C for work over $1,000 to under $30,000, Class B for $30,000 to under $150,000, and Class A for $150,000 or more.
• Health and biohazard work. For medical facilities and biohazard handling, contact your local health department before you bid.
• Chemicals and drains. If your products or wastewater could reach storm drains, ask the Department of Environmental Quality (DEQ) whether rules apply to your work.

Write these boundaries into your service agreement. Clients and staff should know which jobs you will take and which you will refer out.

Step 4: Plan for Employees, Withholding and Insurance

Virginia requires workers' compensation coverage once an employer regularly has three or more employees in the same business (Va. Code 65.2-101). The civil penalty for noncompliance is up to $250 a day, with a maximum of $50,000 (Va. Code 65.2-805). The threshold is where many small cleaning companies get caught off guard.

It is not clear from the statute how part-time, seasonal and temporary workers count toward the three-employee threshold. Ask the Workers' Compensation Commission rather than guessing, and keep a dated record of every person you pay for work.

When you hire, register for withholding with Virginia Tax before your first payroll. Plan your wage rates around the state minimum wage, which is $12.77 in 2026, $13.75 in 2027 and $15.00 in 2028.

On insurance, state law does not require general liability coverage for a cleaning company. In practice, commercial clients commonly ask for a certificate of insurance before they sign. Business owner's policies that bundle liability with property coverage exist, and equipment coverage is a separate question. Premiums vary widely by the type of work, staff count and claims history, so get quotes from several carriers and do not budget from someone else's number.

Step 5: Form the Business and File the Name

Your entity choice drives the SCC filings. Use the SCC's business site at scc.virginia.gov/businesses to confirm current forms and procedures.

If you form an LLC: File Articles of Organization (Form LLC1011) with the SCC for $100, online through the SCC Clerk's Information System (CIS). The name must contain "limited company," "limited liability company," "LC," "L.C.," "LLC" or "L.L.C." and must be distinguishable from names already on file. Online filings can be expedited: next day for $50 or $100 (submitted by 2:00 PM Eastern, response by 4:00 PM the next business day), or same day for $200 (submitted by 10:00 AM Eastern, response by 4:00 PM). Expedited service is online only and nonrefundable. A Virginia LLC files no annual report. It pays a $50 annual registration fee to the SCC, due the last day of the 12th month after the month the LLC was organized, and every year after that. The SCC assesses the fee about two months ahead. A late payment adds a $25 penalty, and the LLC is canceled at the end of the third month after the due date.

If you form a corporation: File Articles of Incorporation (Form SCC619) for $75. A corporation pays an annual report and annual registration fee. The fee is $100 for up to 5,000 authorized shares plus $30 for each additional 5,000 shares. Check the SCC annual fee schedule for the current figures. The annual registration fee is due the last day of the formation month. The annual report is due the last day of the 12th month after formation and may be filed no earlier than three months before that date.

Registered agent: A Virginia LLC or corporation must keep a registered agent who is a Virginia resident with a Virginia street registered office, available during business hours. The agent must be a member of the Virginia State Bar, or a member, manager, officer, trustee or general partner of the entity. An entity cannot be its own agent.

Name reservation: If you need time to file, you can reserve a name for $10 for 120 days. The reservation is renewable in the 45 days before it expires. Details are on the SCC businesses page.

Assumed name (DBA): If you operate under a name other than your legal name or your LLC name, file an Assumed Name Certificate with the SCC for $10. You do not file it with the circuit court, and no newspaper publication is required.

EIN: Get your federal Employer Identification Number from the IRS once your entity is set up. You need it for your bank account, for withholding and for many client forms.

Step 6: Choose Your Service Lines and Supplies

Decide early whether you want residential or commercial work. The two look similar but run differently.

• Residential cleaning is usually recurring or one-time, with schedules set around the homeowner. Your clients are individuals, your margins depend on route density, and your reputation spreads fast through neighborhoods.
• Commercial cleaning means offices, retail, medical suites and other sites. Contracts are longer, scopes are written, and buyers want documentation, insurance certificates and proof of trained staff. Some client types carry their own licensing: child day centers and family day homes are licensed by the Department of Education, while assisted living and adult day care are licensed by the Department of Social Services. Those facilities have their own vendor rules, so ask before you bid.

Supplies fall into categories. Price them yourself from vendors you trust.

• Vacuums and extraction equipment, sized for the surfaces you clean most
• Microfiber cloths, mop systems and color-coded tools to reduce cross-contamination
• Cleaning solutions for general, glass, bathroom and floor work, with labels and safety data sheets kept on file
• Caddies, carts, ladders and extension poles
• Gloves, eye protection and other personal protective equipment for staff
• Floor machines, carpet equipment and window tools, if those services are on your menu

Read the label on every product you use and follow its directions. Keep a written list of what you use in each service type so you can answer client questions quickly.

Step 7: Price for Cost, Taxes and Time

Common pricing models include hourly rates, flat rates per visit, per-square-foot pricing for larger commercial spaces, and recurring monthly contracts with a discount for regular service. Each model has a use. Hourly work is simple but can make clients question every minute. Flat rates are easy to sell but can hurt you if the job takes longer than you estimated. Per-square-foot pricing works for offices with predictable layouts.

Build your price to cover the full cost of the job: labor, supplies, equipment wear, drive time, insurance premiums, and the local BPOL tax, which is based on gross receipts rather than profit. A job that looks profitable on paper can lose money after the license tax and a call-back for missed spots. Track actual time per job for the first few months and adjust your rates against that data.

Step 8: Win Your First Commercial Contract

Most first commercial clients come from people you already know, so start there. Ask former coworkers, property managers and small-business owners whether they need cleaning or know who does. Then build the materials a buyer will ask for:

• A one-page service description that lists what is included and what is not
• A sample cleaning checklist showing frequency by area, such as daily restrooms and weekly floors
• A certificate of insurance ready to send once you have a policy
• Two or three references, ideally from a similar site type
• A written bid with the scope, schedule, price and terms

Walk the site before you bid. Note access hours, security requirements, parking, trash handling and any areas that need special care. A walk-through shows the client you are serious and helps you price accurately. If you want outside help with business planning, the Virginia Small Business Development Center network at virginiasbdc.org offers free advising, and the SBA's Richmond district office lists resources at sba.gov/district/richmond.

Common Mistakes to Avoid

• Assuming no license means no requirements. The state has no cleaning license, but your locality may levy BPOL and the Commissioner may require registration.
• Treating the BPOL cap as your rate. The 36 cents per $100 figure is a ceiling. Ask your locality for its rate.
• Taxing everything or nothing. Keep labor and products on separate invoice lines so sales tax treatment is clear.
• Waiting on workers' compensation. Track your headcount, including part-time and seasonal staff, and ask the Workers' Compensation Commission how to count them before you hit three.
• Skipping insurance. Commercial clients often require a certificate before you start, and an uninsured accident can cost more than a policy.
• Missing the LLC's annual $50 registration fee. Put the due date on your calendar, and note the $25 late penalty and the cancellation risk.
• Taking contracting jobs without checking. Post-construction, mold, fire, flood and biohazard work can cross into licensed work. Ask DPOR first.
• Underpricing to win work. A low bid that leaves no room for supplies, insurance and BPOL tax does not last.

What Results to Expect

A well-run cleaning service may help clients keep their spaces in the condition they want, on a schedule they can rely on. Results depend on the surface, the products used, the staff and how often service happens. Describe your work in those terms. Avoid promising that a product or method will remove all germs, prevent illness, or eliminate mold or pests. Those are claims for product labels and specialized testing, and clients can hold you to them. Using hedged, accurate language protects you and builds trust with buyers who have done their own research.

Official Resources

• State Corporation Commission, Clerk's Office: scc.virginia.gov/businesses
• SCC Clerk's Information System (business search and online filing): cis.scc.virginia.gov
• Virginia Department of Taxation (Virginia Tax): tax.virginia.gov
• Virginia sales and use tax: tax.virginia.gov/sales-and-use-tax
• Virginia Small Business Development Center network: virginiasbdc.org
• SBA Richmond district office: sba.gov/district/richmond

For the local license, contact the Commissioner of the Revenue in your city or county. For contracting questions, contact DPOR. For medical or biohazard work, contact your local health department. Confirm every figure in this article against the agency that administers it before you file, because localities and state agencies update their rates and deadlines.