A business license is a document which gives the owner all the rights to start and run a legal business. It stands for a particular business in a certain place where it is issued. For example, a specific state, country or city. As an online seller, you need to figure out which marketplaces require a business license in order to start your business. For this reason, we took a closer look at Shopify’s policies to determine will Shopify require a business license or not.
When does Shopify require a business license?
First of all, most online sellers do not have to own a business license. In other words, it is manadatory only in a few cases. If you use the Shopify payment gateway or if you earn over $20,000 in a month. Otherwise, Shopify doesn't require a business license, but it is strongly recommended to either check with your legislation office if you still need one by law.
When do you need a business license?
Just to be safe, you should also check your city and county requirements. Because some counties do not allow you to legally start the business without a business license. Also, you need to contact your city’s zoning or planning department to learn whether you can start a business locally. Another thing, which you might need to check is your state requirements. For example, some of them have outlined particular occupations to protect their residents. The common occupations that require a business license include:
- automotive mechanics
- building contractors
- real estate brokers
- collection agencies
- personal service provides
- insurance agencies
You can get more information from the U.S. small business administration about any particular state. Also, there is a certain type of businesses that requires a federal business license. It mostly applies to major corporations, but also includes companies that:
- operate aircraft
- drill for natural gas or oil
- manufacture/import/sell alcoholic beverages
- operate an oversized vehicle
- import or transport animals and plants across state lines
- broadcast via radio/television/cable/satellite
- manufacture/deal/import firearms or ammunition
- produce commercial nuclear energy or fuel
- have wildlife-related activities
- provide ocean transportation, are a commercial fishing business.