Virginia Mandates Informational Combined Reporting Report Due July 1, 2021

House Bill 1800

For several years, the Virginia General Assembly has considered legislation that would change Virginia from a separate entity filing state to a mandatory combined reporting state for corporate income tax purposes.[1]

Virginia House Bill 1800 is the first tangible, legislative step in Virginia toward mandatory combined reporting for corporate income tax purposes.  The state is requiring corporations that are members of a unitary business file an information Virginia combined report by June 1, 2021 (later changed to July 1, 2021 – see below).[2] No extensions are available for this filing.

The combined report will be based on tax year 2019 information and contain the “unitary combined net income” of the unitary combined group. There will be a computation that shows the difference between the tax owed under the members of the unitary group’s current Virginia filing methodology and the “method or methods specified by the Tax Commissioner.”

Some guidance was contained in House Bill 1800 that members of a unitary business group incorporated outside of the United States and more than 80% of their average property, payroll and sales factors outside of the United States are excluded from the unitary combined group.

To encourage compliance, the Virginia General Assembly mandated a penalty of $10,000 to any required corporation that fails to file the informational combined report by the June 1 deadline or that made a “material omission or misstatement.” The Virginia Tax Commissioner is required to submit a report based on the information provided to the commonwealth by taxpayers. This report is due to the Virginia General Assembly by December 1, 2021.

Governor’s Amendments

Governor Ralph Northam included a list of several amendments to HB1800. Among the “Language Only Amendments” was one dealing with the informational combined report. In relevant part, the amendment was to:

“(M)ove the Corporate Income Tax Informational Reporting date by one month, from June 1, 2021, to July 1, 2021. This will allow time for the Department of Taxation to contract for services required to create the applicable changes related to this new requirement. In addition, as businesses continue to recover and manage the impacts of COVID, this delay will provide businesses more time to become aware of and to understand the reporting requirements.”[3]

On April 7, 2021, both houses of the Virginia General Assembly concurred with Governor Northam’s proposed amendment on the due date for the Corporate Income Tax Informational Report so the report is now due on July 1, 2021.[4] No extensions remain available for this filing.

Virginia Department of Taxation News Release

The Virginia Department of Taxation (DOT) issued a news release in mid-April providing additional details about the report.[5] This release provided answers to some questions that companies had been facing, including:

  • The DOT is working on a method to allow taxpayers not required to file the informational unitary combined report to report that fact to the state.
  • Corporations that file either Virginia’s Insurance Premiums License Tax or the Bank Franchise Tax are not considered part of the unitary combined report.
  • Any members of a unitary combined group that have more than 80% of their average property, payroll and sales factors outside of the United States and/or have their income exempted from federal income tax due to a foreign tax treaty are not included in these calculations.
  • The informational unitary combined report will need to be filed under both the Joyce and Finnigan
  • Taxpayers will need to include information about the unitary group’s tax credits as part of the submission to the DOT.
  • The informational unitary combined report will be filed through the DOT’s Web Upload application.

The DOT has also issued a sample upload file and preliminary technical instructions on their website (  Taxpayers should continue to check the DOT website for future updates and the latest information.

DHG Observations

While the DOT has released some information to taxpayers, there are a number of questions that remain unanswered. Given the short turnaround between this legislation’s enactment, future guidance from the DOT and the due date, impacted companies will want to closely follow what is required.

As your company considers the impacts of this informational unitary combined report to your business, reach out to your DHG contacts with any questions.



[1] Note that Virginia does offer taxpayers an elective combined filing and an elective consolidated filing (subject to Virginia Department of Taxation approval).

[2] See

[3] See 2021 Special Session I Budget Amendments – HB1800 (Governor’s Recommendations) at

[4] See for the Senate of Virginia minutes and for the House of Delegates minutes.

[5] See


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