Company Formation, Questions & Answers

Do I need to obtain a business licence in Delaware?

You have finally formed your company in Delaware and have all the necessary documents from the state! However, depending on the nature of your business, there might be some other compliance matters that you might have to deal with as well. The compliance in this sense means that businesses may need business licenses to operate legally and to stay compatible with the regulations of the city/state/federal authority. This is an additional step for the registration of your business to the state, and usually, it is obligatory for certain businesses.

In general, a business license is a permit given by a governmental body to ensure a business can operate within certain jurisdictions. This type of permit aims to protect the health and safety of the public. It also holds a business responsible for its activities. The licenses a company needs depends on the nature of the company and other different factors such as the products sold, the location of the business, etc. For instance, sales tax licenses are required for the sales of taxable products; or some products such as guns or alcohol require federal licenses. State licenses, on the other hand, depends on the state.

But, do not panic. Not all have to apply for and acquire a business license from the State of Delaware. Depending on the circumstances, you might not need a business license at all. For instance, if your company operates from a physical place by the nature of your business, you need a business license. But, if you have an online store and do not run through a physical location, then you may not need a business license. (Even though you may still need acquiring a license depending on other factors, such as the products you sell)

How to Get a Business License?

  • There are different codes for each business type.  So you need to be aware of codes and requirements depending on the nature of your business. Therefore, you may need to do prior research.
  • You may also need to see if you need permits other than a business license for the kind of business you are conducting.
  • Make sure you already have a Federal Tax ID Number before you apply for licenses.
  • Your fingerprints may also be asked for the process in some states.

Consequences of not Having a Business License

  • You may face penalties and additional fees.
  • Moreover, the authorities may close your business temporarily or permanently, which will affect your brand negatively.

Renewal

Some licenses must be renewed annually or every two years. Related authorities usually notify companies about each renewal; however, it is primarily the responsibility of the company itself to renew the licenses.

If you require assistance, we can help you find out what licenses your business needs along with information & forms you are required to provide by sending a unique corporate license pack for you.

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