While looking for the places online where you can start and register your business, the proper small business permits could not be the most fun element of your entrepreneurial journey, but licenses, and permits are important.
Discovering there are different licenses and permits depending on the location isn’t entertaining, nonetheless it is necessary for making certain your company is legal. There are types of business licenses and permits you might need to consider:
A large number of permits shall therefore hinge with the city, county or manner in which the state is, not forgetting the character of business in the provisions. There are typically three types of permits:
- Local: Your specific town, city or township.
- State: The state in where you are operating your business.
- Federal: Amid such conditions, your industry is regulated at the federal level.
This is important to understand because this means that you are not going to get all the permits in one location.
Confused as to where and how to begin your search? Let’s examine the several kinds of business licenses and permits that you might want, their purposes, and how to apply for them:
1. A general business licence
Business licenses and permits are legal regulations that a firm needs to acquire as well as follow in the operation of several activities. Without them you may be forced to pay steep fines or even shut down your business.
A general business license is legal approval allowing you to do business in your city and state. Business licenses are different from the business entities as we have seen in the foregoing sections. In addition to a business license, if you are already operating an established legal business entity such as an LLC you may need a general business license.
I want to recall here that sole proprietorships have the exclusion, as most of the time, you don’t need a general business license to operate in most states.
In most cases, the license to the small business will be provided by your state. For that reason the detailed sequence of the application process might vary from state to state as well as the particular government agency which is used.
- Requirement for: New business owners, those who are transition from other business structures and those who are relocating their businesses.
- Examples: Business persons that include; entrepreneurs, business managers, people or anyone in charge of any business venture.
- How to obtain: You will commonly get your small business license from your state.
2. Employer Identification Number (EIN)
An EIN is not actually a business permit, but it is a box that should be ticked when starting any business. At the same time, even though sole proprietor can use the Social Security number as the TIN, many small business applicants prefer to get the Employer Identification Number.
In the first place, even if you are a sole trader, applying for an EIN may be still useful as it shields your SSN.
- Requirement for: For anyone, beginning a business, employing individuals, or applying for a bank referencing account.
- Examples: Most organizations including; the limited partnership, national corporation, domestic corporations, domestic limited liability corporation, etc.
- How to obtain: From the IRS.
3. Doing business as (DBA)
When you are trading as a one person business, you may opt to conduct your business using a name other than your own. If so, you ought to register the business name you decide on as a ‘doing business as’ (DBA).
A DBA is also called a “trade name” or a “fictitious name” and can be registered with your secretary of state. LLCs and corporations may also filing for DBA.
- Requirement for: An organization in need of a name that clients will easily relate to without going through a legal overhaul.
- Examples: Any business person who would wish to transact business through a business name that is different from their own legal name.
- How to obtain: Your secretary of state’s office, Your secretary of state’s office.
4. Federal Permits
If you are offering a certain service or product sometimes you have to go to the federal level and apply for a federal permit or license. Here are some examples of federally regulated businesses:
- Aviation
- Alcohol
- Agriculture
- Fish and wildlife
- Mining industries, oil & gas drilling companies as well as Nuclear power.
- Logistics and transportation
- Radio and television
First, consult the federal agency that regulates your organizational field in order to determine which permits or licenses may be necessary.
- Requirement for: Market segments and industries that are governed and regulated by federal government legislation, laws and regulations as well as industries that are restricted in their operations by federal legislation such as firearms and telecommunication industries.
- Examples: Any company that wants to start up a local broadcast channel it will have to do so through the Federal FCC or Federal Communications Commission and some officials of the Federal government.
- How to obtain: Other federal agency that can direct influence your industry as it operates.
5. Permits for sales tax
Thus, if you are a seller of certain products or services, most states will require that you have what is referred to as a sales tax permit, seller’s permit, sales tax license, or the sales and use tax permit.
A sales tax permit is a business license required if you sell products or services that are taxable by sales tax rules. Some of the business activities that required such permit are; retails stores or online shops.
To get one, go to your state’s Department of Revenue site (or a similar government agency) and fill out a short form with some information about your business activities. The cost of the permit also varies from state to state; some states may even charge an application fee, but it is almost always symbolic.
- Requirement for: Wholesalers and retailers of commodities.
- Examples: As a retail store or an e-commerce the customer base should be adequately satisfied.
- How to obtain: Your state’s tax authority.
6. Environmental Permits
Your business might need an environmental permit if it needs to discharge emissions, handle some hazardous waste, or discharge water to storm drain. You often require an environmental permit if you engage in activities that may affect the environment for instance when undertaking a construction project or operating an industry.
- Requirement for: Such as those those involved in construction, manufacturing or any activity that has an impact on the environment.
- Examples: Toxicity: it can be used by manufacturing plants, construction companies or any company that deals with dangerous substances.
- How to obtain: Scholars in environmental sciences and students of Environmental science majors at the federal state or local level environmental protection agencies.
Also Read | Hiring a small business accountant
7. Permits for fires
Retail merchants, establishments handling volatile substances, companies that operate in premises with a combined population of people in excess of a certain number; may require a fire permit from the fire department.
These business licenses and permits are intended to meet the fire safety regulation requirements. It is crucial to realise that the fire safety inspections may be included in the fire permitting process.
- Requirement for: Hazardous fire risks at business, facility, or events.
- Examples: Business establishments which contain fire risks such as restaurants, theaters or manufacturing companies.
- How to obtain: Local fire department or any other body of authority that will be appropriated enough to handle the issue.
8. The health permits
Some kinds of commercial activities will also require a health permit for the premises to conform to legal requirements. For instance when doing a restaurant or food business you are likely to need a health license. You also might need one if dealing with medical waste or if you’re in the business of running health care facility.
- Requirement for: Food chain operation including eateries, health service activities, and any business that poses potential threats to the population’s health.
- Examples: It affects mostly business entities who work with food, especially by preparing, packing and serving of the same.
- How to obtain: Local health department.
9. The Professional licenses
Some fields demand that their practitioners possess licenses in an effort to guarantee competency. Some of the licensed professions include land surveyors, doctors, lawyers, cosmetologists, building constructors, electricians among others.
For instance, where recruiting an accountant, you should be in a position to find out if he or she holds a certified public accountant license through American Institute of Certified Public Accountants.
Besides professional licensure, there may be conditions that you are supposed to update your knowledge or even obey.
- Requirement for: Persons engaged in any of the regulated professions or occupation.
- Examples: Lawyers, doctors, engineers or any knowledgeable labor force.
- How to obtain: The appropriate licensing boards as may be relevant across professionals subject to regulation.
10. State licenses
Those activities such as selling of alcoholic beverages or antiques will as well require proper licenses and permits from the state. Some activities are often controlled by states i.e. transportation or professional practices.
For instance, if you are involved in activities such as childcare, or provision of education services, you may require a state permit from the agency.
- Requirement for: Companies, performing certain activities or being engaged in some kinds of industries which are controlled by the state.
- Examples: Employer that provide transportation services or a child daycare center.
- How to obtain: State entities of regulation of work together with state departments.
11. Construction permits
Many of the Volstead act and permit concerns will be dictated by where you are located, or the city, county, and state. However, you’ll need certain permits depending on its physical location of the business or building.
For instance, when you want to construct a business structure or a structure that will need a great overhaul you need to apply for the right building permit from the local authorities. Permits eliminate cases of constructing structures that are unsafe to users and others in the society.
- Requirement for: Those who are those redeveloping or renovating structures, expanding the structures or making drastic changes.
- Examples: Those people who are contracted to carry out commercial construction works.
- How to obtain: Local building departments or the municipalities in which they exist.
12. Licenses for home-based businesses
Despite having to run a business from home seeming as the easiest way of avoiding business permit complications, this is not so. A few cities or counties may allow you to do business out of your own house; therefore, you will need a permit to operate such business.
Besides the home-based business permits, the applicant should also find out whether their lease agreement or homeowners’ association prohibits the activities of such businesses.
- Requirement for: House hold business people fixing kitchen in their homes.
- Examples: Some of the target markets are the solopreneurs and self-employed people.In Mums and business, the key target market could include; Freelancers or consultants, artists or anybody who operates a business from home.
- How to obtain: Zoning or planning departments in local authorities, town and city halls.
13. Permit signs
Some areas still have regulation ordinances at that local level, which make you need a permit to put up a sign. Sign regulations are helpful in issues related to aesthetics and safety.
There is always a provision for fixed or temporary signs for advertising or purpose of identification you should contact your local planning department.
- Requirement for: Exterior signs that are being installed by either business or an individual.
- Examples: Outdoor signs that are placed at retail stores or restaurants.
- How to obtain: Local zoning or planning departments is another good source of education information for child care providers since they offer vital information that theproviders need in helping with development of child care programs that will suit the needs of the children.
14. Zoning permits
However, use this warning, you can not simply decide to open your business anywhere that you would like to. Don’t plan to do business where no zoning ordinances allow you to. In turn, zoning permits enable a proper balance of the various uses of the land within a society.
For instance, you may need a loan for realizing construction of a converted farm house where you want to run a bed and breakfast business. Often, it may be necessary to secure a special permission just as one requires a variance or a conditional use permit.
- Requirement for: Any organization or person planning changes in control and use of land, structures, and property development.
- Examples: Developers of real estates or companies engaging in extension or re-zoning of any land.
- How to obtain: Local zoning or planning departments are another restriction to micro-finance’s expansion probability since they ascertain the physical infrastructure of an area.
Why right business licenses and permit are important
As business people should know, obtaining the proper permits is one of the initial essential tasks before establishment.
Lack of the appropriate small company permissions can result in:
- Suspensions or probations: You might even be barred from operating if do not have the right permits for your business.
- Fees and fines: Lack of proper permits is fined by federal or state department.
- Inaccessible funding: Should you apply for a business loan then the lenders will request to see a small business license as well as any permit required in the industry.
- Damaged reputation: Your customers or vendors could easily find out that you don’t possess the right permits and this will make your business seem untrustworthy.
- Lawsuit liability: Something may go wrong and without the correct permits or licenses it is you who will land yourself in legal trouble.
These are all avoidable in case you ensure you have the right licenses and permits as your certificate of authority.
Start your business with faith
In fact, one need to name his business, and find customers but equally essential is make sure that you have the license and permits to operate your business. These and many other aspects can help you have ones and zeros on your side as you deal with taxes and bookkeeping with accounting software like QuickBooks which checks several things on your list towards owning a successful business.
