Many parts of launching a new business are exciting for entrepreneurs, but the paperwork involved is certainly less exciting. Case in point: Business licenses. Little about obtaining business licenses is as thrilling as actually doing business, but you can’t do the latter without the former. The good news is, obtaining business licenses doesn’t have to be complicated – especially if you follow the below guide on how and where to apply for a business license.
A business license is an official government document that permits your company to operate. Without a business license, you cannot legally conduct business – governments require businesses in many sectors to acquire a license so they can hold companies accountable, tax companies properly, and ensure that companies are complying with public health regulations.
Among the types of licenses you might need to obtain are:
To learn more about these types of business licenses and whether they might apply to your company, read the following SmartBiz Loans blog: What Are the Types of Business Licenses?
Companies in many industries must obtain a business license from their local government. Your company may have additional licensing requirements if it meets any of the following descriptions:
In professional fields including, but far from limited to, accounting, law, real estate, cosmetology, real estate, hair styling, and medicine, companies must obtain state licenses from the appropriate state professional association. Visit this database of professions requiring state licensure to determine your company’s requirements.
The cost of a business license varies by location and, if applicable, by profession. A business license often costs hundreds or sometimes thousands of dollars per year. You’ll also pay annual renewal fees, with penalties for late renewal. Consult each of your licensing agencies to determine how much you’ll pay for your license acquisition and renewal.
Applying for a business license will be a hassle-free process if you follow these steps:
You’ll need the following information when you apply for a business license:
To get a business license from your local government, contact your jurisdiction’s Department of Business and Professional Regulation (DBPR). If your local government doesn’t have a DBPR, ask your local labor office which steps you must take. You may need to register your business with your county clerk, though procedures vary by location.
While you’re speaking with your local licensure agency, ask about obtaining your sales tax permit and, if applicable, safety, DBA, and sign permits. Officials in your local licensure agency may also know where to apply for these additional business licenses.
While you work toward meeting your local licensure requirements, determine whether your company needs to obtain professional and federal licensure as well. If it does, contact the relevant agencies to discuss the licensure process. Gather all needed federal and professional paperwork and documentation while working toward your local business license – you’ll need all your required licenses to start your company.
Launching a company means determining your company’s name. That’s why trademarks and service marks exist. A trademark is a word, symbol, phrase, and/or design unique to a company’s goods, and a service mark is the same but for services instead of goods. The United States Patent and Trademark Office (USPTO) runs a list of state trademarking and service marking agencies – contact the appropriate office to get started.
Once you have all your ducks in a row, head to your jurisdiction’s city hall or central government office to apply. When you file your application, ask how long you should expect for approval. You should also ask for a contact who can give you updates or a website that automatically tracks your application’s progress.
Once you receive your business license, you’ll likely need to renew it at least annually. For some professional licenses, your company may also need to meet ongoing training or continuing education requirements. In any case, do what you must to keep your licenses intact – without valid licenses, traditional lenders will be less likely to offer you funding.