How to get a small business license: Does your startup need it or not?
Almost all businesses need licenses based on their location and type of business. You are in the right place if you are searching for how to get a small business license. However, you could be spared if your business comes into the following category:
Creative business:
Artists and crafters who use their creativity to make and sell products do not need a business license. But, if you are doing the work of a plumber, construction-related work and so on you need a business license
Independent contractors or sole proprietors:
Generally, freelancers such as app developers, web designers, content writers, etc. do not need a business license to offer services.
Independent salesperson:
If you are making products and selling on your own or using online sites such as Etsy then you do not need a business license.
Consultants and life coaches:
Any person with expertise in a certain life sphere does not need a biz license to start or continue their biz. However, if you are consulting for anything that requires certification such as medicine, diet, workout then you must have a business license.
NOTE: Irrespective of following under the above category some might need a business license depending on the rules of their country and state.
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What is a business license?
A business license is an approval from the Government to let you do business in the city. Every company that has an income stream needs a business license. You have to pay a fee to your local or city or state authorities to have a business license
Most often startups think they are good to go just after registering the business. Well, no! After registering the biz you need to know which types of licenses and permits your business might require and get that to continue smooth operation.
Why do businesses need a business license?
You need a biz license because you want your biz to be safe and flourishing without any obstacles from the Government.
According to U.S. Small Business Administration, “Most small businesses need a combination of licenses and permits from both federal and state agencies. The requirements-and fess-vary based on your business activities, location, and government rules.”
Compliance friendly:
Businesses that have licenses by the Government are protected by the local, state as well as national governments. This ensures your business will be safe as long as you want to run it. Government tracks tax revenue through business License. It ensures the safety and health of people residing around your business location.
Reputation:
Biz with a license holds high value in the eyes of customers. Customers will trust your good or services. Hence, you can generate money faster. You will not have to constantly operate in the fear of getting your biz collapsed due to the Government.
Smooth operation:
You need a biz license because you want to smoothly operate your occupation. Licensed businesses are free to operate tasks without much interference from Government bodies.
How to get a small business license?
It is easy to get a small business license however it is tedious to figure out which kind of license your small biz needs. If your thoughts are clouded you can book a consultation call with us. Our first service is for free so you will not be risking any money yet will get the opportunity to talk to a lawyer with 14+ years of experience.
If you know which license fits best for your biz here is how you can get:
Application process:
First, we need to start with the application process. Compile all the documents that might be required to get the business license. You will require your Employee Identification Number (EIN), type of business such as Limited Liability Company, Partnership and so on.
The document varies from place to place. However, mostly apart from identification number and type of biz, you must have the number of employees, name of business owner, biz address, code, sales tax permit, corporate records and contact number. Every type of business has a different business code, know your code beforehand.
These documents help your business be in compliance with state, country and federal business laws. If you find these tasks complex, you can contact a legal consultation service to make the process easier for you.
Also, read: Here is a guide to help you know your business type if you are based in Qatar.
Submission:
You can either visit the physical office or submit it online as your state permits. Your location’s municipality website will fetch you the exact process. Apart from business licenses some also need different kinds of permits to operate.
Here are a few, Sales tax permit, Zoning permit, Fire safety permit, Health permit, Home occupation permit, Environmental permit, Sign permit and so on.
Pay filing fee:
The annual fee for establishing a home-based venture in Qatar is QAR 1,020. Similarly, the Filling fee varies from country to country. In the US it is between $50 to $400.
Glimer on businessnwsdaily said, “For industry-specific and local licenses, fees can range from anywhere from a few dollars to a few thousand dollars, either one time or on an ongoing basis. For budgeting purposes, business owners should do their homework and contact the relevant agencies as part of the planning process”.
After paying the filing fee you will have to wait for a week or two to get your business license. Some states take even months to permit licenses depending on the licensing complexity.
Maintain touch with the Government office after submission to manage any deficiencies quickly. Once you get your license do not forget to renew the license from time to time.
Make sure before applying for a license, you and your business meet the Government requirements. For instance, to get a home-based business license in Qatar you must be 18 or above.
Wrapping up
A licensed business allows customers and investors to trust the products and services. Here, we have explained step by step process to seek a small business license. However, if you are still confused you can raise your Questions here.
