To function lawfully, most businesses will require some kind of licence. A business licence enables your company to operate in your sector or jurisdiction. A licence may be required by the federal or state governments.
A business licence, on the other hand, advantages your organisation. Proper licensure can convey a strong signal to prospective clients (and even workers) that your company is trustworthy. This might give you a competitive advantage in various industries because it demonstrates that your small business has followed established regulations.
However, just because your company requires a local or state business licence does not guarantee it also need a federal business licence. We’ve included a helpful summary of the various sorts of company licences that fall into three categories: federal, state, and municipal.
In general, you can anticipate to go through the following processes while applying for a business licence:
How can I get a company licence?
- Determine your company’s licence requirements.
What type of business licence do you require? The federal government may control your specific business activity in some situations, so this may be a smart place to start.
Assume your company provides regulated items or services (alcohol, gasoline, firearms, etc.). In such scenario, you should plan on applying for a licence or permit not only at the federal level, but also at the state, county, or local level.
- Gather all of the necessary documentation.
Once you’ve determined which licences you’ll require, you can begin compiling the documentation required to complete your applications. Again, this may vary based on your location and the nature of your business, but you should generally expect to require the following:
– A summary of your company’s/activities business’s
– Copies of corporation documents
– Proof of state or local residency (e.g., a sales tax permit)
– Ownership and management structure lists
- For tax purposes, you must register.
Then, register your company for taxation. Obtain an employment identification number (EIN) from the IRS and keep any local tax obligations in mind.
The Georgia Department of Revenue, for example, requires owners to apply for a State Taxpayer Identification Number (STIN). Individual states may have different criteria for how you register for taxes.
If you meet the following requirements, you will apply through your state’s Department of Revenue:
– You require state or local endorsements
– You operate your business under a name other than your own
– You sell a product or service that requires sales tax
– You intend to hire employees within the next 90 days
- Submit the application for a business licence.
Apply for a business licence through the appropriate federal, state, or local offices. The process will go more smoothly if you know the licences and permits you need for your business activity. Then it’s only a matter of following the instructions for each application.
- Get your company licence.
Throughout this procedure, don’t be afraid to call your local offices to check on the status of your application and to clear up any problems that may arise.
Following approval, you may be required to display specific licences and permissions at your company location. To continue engaging in your primary business activity or providing services, you must keep your licence current.
- Maintain compliance with licence regulations.
It’s critical to stay up to date on any and all renewal requirements that may relate to your company or sector. If you fail to keep your company licence up to date, you may be fined or even shut down.
Renewal criteria are generally the same as those for new licences, while each licence may have particular details that demand your attention.