If you want to start a business, then you need to take care of many things. The first and foremost step is to obtain a business license and other necessary permits. Irrespective of the nature of your business, you must secure proper business licenses and permits. Whether you wish to open an online business, a retail store, or a vending machine business, your business license and permits enable you to duly comply with federal, state, and local regulations. Today, in this blog, you will get to know everything about acquiring business licenses and permits as and when required.
Business License: What Is It?
A business license is an essential document issued by the government or a government authority that enables you to do business legally. There are different kinds of legal requirements that you need to meet to obtain a business license. Factors like industry regulations, your municipality or state, and business location determine the requirements of the business license.
Reasons for You to Obtain a Business License
The importance of a business license is immense to run your business. It is not just a piece of paper or document. It is rather a legal permission that enables you to run your business smoothly without any issues. Some of the reasons for which you are required to get your hands on a business license are described below.
Legal Compliance
It is essential for you to ensure all the legal compliance to be able to run a business without any issues. Running a business without a proper license will result in hefty penalties, fines, or even shutdown of your business.
Tax Purposes
The other important reason for obtaining a license is to ensure that your business is registered for tax purposes. It also helps to maintain accurate financial records.
Building Trust
Customers are less likely to put their trust in a business without valid licenses. This is why obtaining a business license is also likely to increase your acceptability to your customers. The consumers understand that you are operating your business transparently and legally.
Federal Business Licenses and Permits
Prior to starting your business, you need to acquire a combination of licenses and permits from both federal and state agencies. If your business is to be regulated by the federal authority, then you will require a federal permit or business license.
The fees and requirements for the business license depend on the issuing agency and your business activity. It is important for you to explore all the aspects in detail before applying for a specific business license or permit. Check the list to know more about this.
Business Activity |
Description |
Issuing Authority |
| Alcoholic beverages |
|
|
| Agriculture | The transport or import across state lines of:
|
U.S. Department of Agriculture (Apply Now) |
| Ammunition, Firearms, and explosives |
|
Bureau of Alcohol, Tobacco, Firearms and Explosives (Apply Now) |
| Aviation |
|
Federal Aviation Administration (Apply Now) (business license) |
| Fish and wildlife |
|
U.S. Fish and Wildlife Service (Apply Now) |
| Maritime transportation |
|
Federal Maritime Commission (Apply Now) |
| Commercial fisheries | Commercial fishing of any type | National Oceanic and Atmospheric Administration Fisheries Service (Apply Now) |
| Nuclear energy |
|
U.S. Nuclear Regulatory Commission (Apply Now) |
| Mining and drilling | Drilling for natural gas, oil, or other mineral resources on federal lands | Bureau of Safety and Environmental Enforcement (Apply Now) |
| Transportation and logistics | Operation of an oversize vehicle
– Permits are issued by your state government, but the U.S. Department of Transportation can direct you to the correct state office |
U.S. Department of Transportation (Apply Now) |
| Radio and television broadcasting | Information broadcasts via:
Radio, Television, Wire, Satellite, Cable |
Federal Communications Commission (Apply Now) |
State Business Licenses and Permits
The business licenses and permits you require from the county, state, or city depend on your business location and business activities. The fees also vary depending on different factors. After gathering all the prerequisite information and details, you should proceed to apply for a business license and permit.
States are there to effectively regulate a broader range of activities as compared to the federal government. The business activities that are mainly regulated at the local level are:
- Vending machines
- Retail
- Restaurants
- Plumbing
- Farming
- Dry cleaning
- Construction
- Auctions
Various business licenses and permits expire after a specific time period. You are required to keep track of when you have to renew them — it’s often easier to renew than it is to apply for a new one.
You must do prior research on your own state, county, and city regulations. The industry requirements for the same often vary by state. It would make your job easy if you visit your Secretary of State’s website to know which ones and permits you actually require.
How to Apply for a Business License?
If you are looking for a business license, then you are required to follow this step-by-step guide described below.
Decide on the License You Require
There are different kinds of business licenses. The first thing for you is to decide which type you are supposed to go for. The location and type of your business will determine which one you will need. For instance, if you wish to run an online business, then getting a general license and seller’s permit would be enough. On the other hand, in the case of a vending machine business, you have to obtain a vending permit.
Register the Business
The next step for you is to register your business structure (e.g., corporation, LLC, and proprietorship) and name. This step is essential prior to applying.
Contact the Business License Issuing Authority
Find the government agency responsible for issuing licenses and permits for your businesses. Contact their office. It could be a state department, a county, or a city clerk’s office.
Complete Your Application
At this step, you are supposed to apply for one. Provide all the required details and information about your business, including type of business, address, and name. You may also have to fill out the additional documentation.
Pay the Fees
There are some fees that you are supposed to pay for your business license. The amount depends on several factors like business location, type of industry, etc. You need to pay the fee while submitting the application.
Await for the Approval
The processing will take some time. You have to wait for the approval. The processing time may vary depending on various aspects and things.
Renew the Business License
Most are required to be renewed at the end of their validity period. This is why you are supposed to renew the license within the deadline to avoid fines or penalties.
The Significance of Business Permits
Apart from that, the role and significance of permits are also immense while running a business. There are different types of permits that you might need to go for.
Zoning Permits
It is essential for you to obtain zoning permits for your business depending on specific zoning laws in your business location.
Health and Safety Permits
If you wish to open a business handling beverages, food, or healthcare services, then you need to have such permits.
Environmental Permits
This type of permit is necessary for those businesses that might impact the environment, such as manufacturing.
Conclusion
Getting the right business license and permit is extremely important for your business. It helps you to stick to proper legal compliance while building trust with your customers. All you need to do is do proper research about the different aspects of it before applying for one.
No matter what type of business you plan to start, you must obtain proper permits for all the right reasons. Legal compliance is the first step that you should follow to run and grow your business.
FAQs – Business License
How to Get a Business License?
Ans: You are required to apply for it through the local issuing authority while meeting all the regulatory and legal requirements.
How to Start a Business?
Ans: It requires you to select a business structure, obtain licenses and permits, register with the relevant authorities, and comply with the local regulations.
What Criteria You Need to Match to Start a Vending Machine Business?
Ans: You should first get a general business license, health permits, and seller’s permit, depending on the product you will sell.
Is there Any Business that Depends on Women?
Ans: Business is not gender-specific. However, there are various businesses where women are given additional grants or aid for encouragement.
Which Business Should You Opt for Only in Your State?
Ans: There are different kinds of businesses that you can choose to do in your state. It all depends on your personal choice and preference.
When Do You Need a Seller’s Permit?
Ans: If you wish to sell something in your business, then you are supposed to obtain a seller’s permit.
