What Business Licenses and Permits are Needed in Ohio?
Starting a business in Ohio will mean potentially registering with a number of federal, state, and local agencies. Let’s take a look at common licenses and permits a business will register for in Ohio.
Before applying for any licenses, the business structure will first need to be established. Learn more about the differences between the sole proprietorship, general partnership, corporation, and Limited Liability Company (LLC).
Related: Comparison of Business Entities
Learn more about forming an LLC in Ohio
Also see: Steps to starting a business in Ohio
General Business License
There is no general state of Ohio business license, however, many cities require businesses to be licensed. Rules for business registration vary depending on location and what the business does. Below are a few cities that have licensing requirements.
Columbus – The City of Columbus requires certain businesses such as restaurants, daycares, salons, and barbershops to obtain a business license to operate in Columbus.
Cincinnati – Some businesses will need to register with the Cincinnati Department of Finance & Budget to do business within city limits. A few of these businesses include antique dealers, food establishments, skating rinks, and more.
Toledo – Businesses such as dance halls, junk yards, mobile food vendors, tow trucks, and more will need to obtain licensing with the city.
Akron – An Akron Business License is required for certain types of businesses operating in the city’s corporate limits, such as alarm installers, firearm dealers, ice cream trucks, and more.
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Building & Zoning Permits
Zoning – Depending on the location of the business, it’s important to verify whether the business needs an occupancy permit or has specific zoning regulations to follow. Depending on city requirements, home-based businesses may need to apply for a home occupation permit.
Building Permit – A building permit may be needed from the city or county building and planning department if there is any construction or renovations to a facility.
Signage Permit – Some municipalities require a permit before adding signage.
Ohio Vendor’s License
Ohio law requires any person or business making taxable retail sales or services to register for an Ohio Vendor’s License with the Ohio Department of Taxation. Retailers with a fixed place of business may also apply for a vendor’s license with their County Auditor.
Commercial Activity Tax
Businesses with total revenues of over $150,000 in a calendar year must register for the Commercial Activity Tax (CAT) with the Ohio Department of Taxation.
Sales Tax Exemption Certificate
Businesses purchasing merchandise to resell will usually want to obtain an Ohio Sales Tax Exemption Certificate (often referred to as a Resale Certificate) in order to not pay sales tax for merchandise that is being resold to customers.
A variety of occupations in the state are regulated and need to register, such as appraisers, bait dealers, contractors, exterminators, salons, and many more. Additional information, fees, and licensing requirements for professions are available from the state of Ohio.
Employer Identification Number (EIN)
Many businesses will register with the Internal Revenue Service (IRS) for an EIN (also referred to as a FEIN, Federal Employer Identification Number, or Federal Tax ID Number). The EIN is the business equivalent of a Social Security Number for an individual. Corporations, Limited Liability Companies, Partnerships, and Sole Proprietorships with employees will all need to register for one. Sole Proprietorships without employees can use the owner’s Social Security Number.
There is no cost for an EIN, and it only takes a few minutes to get.
Trade Name Registration
While not a business license, it’s common for Sole Proprietorships and Partnerships operating under a company name that is different from the full name of the owner(s) to register for a Trade Name (also known as a Doing Business As, DBA, or Fictitious Name) with the Ohio Secretary of State.
These are just some of the most common business licenses a new business will need to register before starting. Before starting your business, be sure to check with the Ohio Business Gateway, City Hall, County Clerk, Chamber of Commerce, and/or Economic Developer in your area to get more information regarding the proper licenses for your business.
I am still a little confused on what/which license/s I’m required to have.
My business would essentially have two divisions: 1. selling handmade jewelry online (Etsy) 2. selling other handmade craft products in retail shops, on consignment.
Do I need a. For Profit (Ohio), b. LLC (Ohio), c. Trade Name Registration, or a combination of them?
Thank you for any advice you can provide!
Hi Cynthia – To start with, it looks like you are looking at which entity to choose from. If you set up as a sole proprietorship (probably the same as for profit), you may also need the Trade Name Registration, but if you went with the LLC, you wouldn’t. Here is some more information in Ohio that may be helpful – https://startingyourbusiness.com/ohio/.
In addition to the entity, there would be additional licensing. You would want to check at the city level to see if you need licensing, as even home based businesses need to be licensed in some areas. An Ohio Vendor’s License would be needed, and hopefully soon, you would register for the Commercial Activity Tax (sales over $150k in a calendar year).
Hopefully, this helps. Let me know if you have any other questions.