Starting your business journey can be an exciting and financially fulfilling journey. However, doing business without required licenses can cost you a hefty fine.
Picture this: You have a stunning startup idea that can be a million-dollar project in the business market. But you failed to obtain the license. You just forgot about licensing or simply didn’t bother to take one. Guess what happens? The NY government will enforce penalties on you. And no wonder that the government will shut down your business.
A million-dollar business just vanished! Hang on! You can stop all of this from happening. The process of getting a business license in NYC might feel chaotic, but with the proper guidance, you can handle it all. So, the blog will talk about finding the right business license for your specific industry, applying for a license and more.
Understanding NY Business License Basics
Operating a business in the big apple comes with multiple licensing requirements. You might need to obtain multiple licenses based on your business requirements.
No “One Size Fits All” License:
New York is a hub of businesses. Different industries require different types of license. For instance a food establishment requires a different permit as opposed to locksmith business NYC.
In short, New York State does not have a single general business license. Every industry has its own license. Moreover, licensing heavily depends on your specific business activities. For example, if you are selling food on a push cart, you will require a zoning permit to place that cart in a particular area, a food inspection (as a requirement), and a mobile food vending business license.
Quick Note: Multiple licenses might be required at state, city, and federal levels as well.
Key Factors Determining Your Needs:
Once you set up your business plan and are ready to acquire customers, your first step should be determining your business-specific needs. Here are factors to consider:
- Business’s primary activity. For instance, food services, contracting and retail services.
- Business location should also be considered, as NYC has specific local requirements. You might need additional zoning permits.
- Business size and number of employees are also considerable factors.
- The business structure also impacts your licensing requirements. Sole proprietorship businesses have varying requirements from those of LLCs and Corporations.
Bonus Tip: You must have a legal business structure first to obtain a business license.
The Basic Requirements of Your Business
Even the simplest business requires a license in NYC there is no exception. If your business deals with customers you must get a valid license from the NYC government.
Choose Your Business Structure:
The first is to choose your business structure. It majorly involves determining the size of your business, the partnerships involved and the employees. You can choose from:
- Sole Proprietorship: Simplest, but no personal liability protection.
- Partnership: Shared ownership and liability.
- Limited Liability Company (LLC): Personal liability protection, flexible.
- Corporation: Separate legal entity, complex but suitable for scaling.
Action: If you are registering a business with a different name other than your actual business (corporation) name. You will require a DBA (Doing Business As – DBA).
Obtain Your Employer Identification Number (EIN):
For businesses that operate on specific structures like LLCs or Corporations, you will need EIN.
EIN is basically an Employer Identification number which is required by the IRS. It allows you to withhold taxes and submit them to the IRS on behalf of your employees. We can say it works as a Social Security number for a business.
Action: You can apply for EIN through the IRS official website.
Legit Resources NYC Level Requirements
You can use the website for your particular business license.
The NYC Business Express Website & Business Wizard:
NYC Business Express Website and Business Wizard is the primary source for NYC entrepreneurs. It answers specific questions about your business type and activities. In fact, it can help you with a general and customized list of city, state and federal license requirements.
Action: Utilize the NYC Business Wizard early in your process.
NYC Department of Consumer and Worker Protection (DCWP) Licenses:
DCWP regulates many types of businesses directly interacting with consumers. For example DCWP provides General Vendors, Home Improvement Contractors, Car Service Bases, Sidewalk Cafes regulations.
Action: Check the DCWP website and your Business Wizard results for specific licenses.
NYC Department of Health and Mental Hygiene (DOHMH):
DOHMH is another crucial resource to get information, specifically if you are providing health-related services. Beneficial for Restaurants, Cafes, Food Trucks, Salons (if health-related services). Further, business processing food like preservation, freezing, boiling, drying and vacuum-packing should also utilize DOHMH.
Action: Consult DOHMH regulations if your business involves food or public health.
Zoning and Building Permits:
Zoning permits are issued by the NYC Department of Buildings (DOB) and Department of City Planning. These permits are required for business involving construction, renovation or significant change of use for a commercial area.
Action: Verify zoning compliance and permit needs for your chosen location.
New York State-Level Requirements
New York has different licensing and taxation requirements at both the state and city levels. To get a better understanding of NYS-level requirements, you can use the mentioned sources:
NYS Department of Taxation and Finance:
For businesses that sell taxable goods or services it is mandatory to get a certificate of authority. It helps the department of taxation and finance to keep a good record of all businesses who sell taxable goods.
Action: Register for your Certificate of Authority at least 20 days before starting sales.
Division of Licensing Services:
The Division of Licensing Services licenses many professionals and businesses across the state. You can expect:
- Real Estate
- Security Guards
- Barbers
- Cosmetologists
- Notaries Public
- Private Investigators
Licenses from Division of Licensing Services. Bear in mind, business and professionals operating in multiple states will require licenses from other states as well.
Action: Verify if your profession requires a state occupational license.
Ongoing Compliance and Best Practices
Displaying Licenses:
NY mandates many licenses to be prominently displayed at your business location. It represents the authenticity of your business. Here is a quick list of the companies that require displaying permits:
- General Vendor License
- Home Improvement Contractor License
- Food Service Establishment Permit
- Sidewalk Cafe Permit
- Car Service Base/Driver Licenses
- Barber Shop/Beauty Salon Licenses
Any business regulated by DCWP will have to display requirements.
Renewals:
There is no lifetime license available for businesses. Each permit requires periodic renewal (annually, biennial). Some licenses might take longer to expire. For example, professional licenses like nursing and engineering usually have more prolonged expiration.
However, it is recommended that reminders for renewal deadlines be set to avoid penalties.
Compliance with Regulations:
Beyond initial licensing, industries require compliance with regulations. Maintaining professional standards and quality work is recommended. Furthermore, if you are in a food-related business, random inspection for hygiene can be expected. Moreover, make sure you adhere to:
- Industry-specific regulations
- Safety standards
- Labor laws
Record Keeping:
It is essential to maintain organized records of all licenses, permits, applications, and communication with regulatory authorities.
Conclusion
Getting a business license isn’t a straightforward process. It is not like filing an application, paying some fee and you are done. NYC licenses involve understanding multi-layered requirements. If you feel stuck, Tax king Service is here to help! We help businesses get the right business license in an efficient and seamless manner.
So, when licensing feels like a burden, know that we are one call away!
