What Business Licenses and Permits are Needed in Texas?
Starting a business in Texas 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 Texas.
Before applying for any licenses, the business structure of the company 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 Texas
Also see: Steps to starting a business in Texas
General Business License
There is no general state of Texas business license, however, many cities require businesses to be licensed in order to operate. Business license requirements vary depending on location and what the business does. Below are a few cities that have licensing requirements.
Houston – While there isn’t a business license registration in Houston, businesses in Harris County are required to report business use of property valued at over $500. There is a Business Personal Property Rendition form that will be filed annually.
A Certificate of Occupancy is required for businesses operating in a commercial building from the Houston Planning and Development District.
San Antonio – Businesses operating out of a commercial building will need to obtain a Certificate of Occupancy.
Additionally, a few types of businesses such as those selling alcohol, using coin-operated machines, or peddlers will need a license from the city.
Dallas – A Certificate of Occupancy is needed for the commercial use of a building in Dallas. The filing fee for this license is $215 plus a $65 Code Compliance Fee.
A Dallas business license is needed for several different types of businesses such as amusement centers, businesses selling alcohol, precious metal vendors, etc.
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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.
Sales Tax Permit
Businesses engaged in selling or leasing tangible personal property or taxable services in Texas need to register for a Texas Sales Tax Permit (also called a seller’s permit) from the Texas Comptroller.
Businesses purchasing merchandise to resell will usually want to obtain a Texas Resale Certificate to not pay sales tax for merchandise that is resold to customers.
A variety of professions in the state are regulated and need to be registered before offering certain services. A few common professions that require licensing in Texas include; therapists, tattoo studios, salvage brokers, food establishments, and many more. Additional information, fees, and licensing requirements for professions are available from the Texas Department of State Health Services.
In addition to professional licenses from the Texas Department of Health Services, businesses in a variety of industries such as daycares and salvage yards also require licensing.
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.
Assumed Name Registration
While not a business license, it’s common for Sole Proprietorships and Partnerships operating under a name that is different from the full name of the owner(s) to register for an Assumed Name (also known as a Doing Business As or DBA) with the County Clerk’s Office in the county where the business is located.
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 City Hall, County Clerk, Chamber of Commerce, and/or Economic Developer in your area to get more information regarding business licensing.
I have registered my business name with the state, and I’d like to work on receiving a business permit and a reseller’s permit. May I ask how that process is done, how much is cost to get both of those, and when can I expect to receive those credentials? Thank you and please get back to me, have a wonderful day.
Hi Sterling & Aaron
I can’t give you an answer on the cost or process on business licenses, because the licenses you need will vary by where the business is located and what it does. You will want to check with the city hall, Chamber of Commerce, or economic development office in your community to get more info.
To get a reseller’s permit, you will need to register for a Sales Tax Permit (https://startingyourbusiness.com/how-to-register-for-a-sales-tax-permit-in-texas/) first as the number will be needed to fill out the Resale Certificate (https://startingyourbusiness.com/texas-resale-certificate/). There is no fee for the Sales Tax Permit or Resale Certificate. Expect 2-3 weeks to get the Sales Tax Permit and there is no time for the Resale Certificate.
Hope this helps. Let me know if you have any other questions!