Some Essential Licenses and Paperwork Every New Business Owner Needs

Every business needs to go through the legal grind before it can be established. It is important for business owners, especially small time business entrepreneurs who cannot afford to lose money on legal issues, to understand the importance of licenses and patents and to duly fill in these before they go about setting up their business.

Why are licenses required?

From a market point of view, licensing is required because it gives your clients the assurance that they are dealing with certified and legal business owners who are not a part of a fraud.

The government requires businesses to be licensed and duly registered so that it is easier to track revenue from these businesses and the process of taxation can be simplified. If your business is not registered or licensed, it can be looked at as an act of tax evasion of illicit activity and you can be charged for tax fraud. Most of the times it happens for a very simple reason that small business owners are merely unaware of what is required of them in terms of legalities when it comes to setting up a business. Hire patent attorneys to help you with the patent process and documents for your business.

From an industry standpoint, paperwork like patents are very important in protecting trade processes which you would not like your competitors to know. Though patents are not applicable to all industries and businesses, they are a useful tool in the industry nonetheless.

What kind of licenses do I need?

Though the exact requirements vary greatly depending on the type of business we are talking of; a home-based business needs different paperwork than a multinational, there are some common and basic licenses that every business owner should possess. These are:

1. General Business Licenses – This is an annual license or permit that entitles you to the right to operate a business in your city. It requires a small fee to procure.

2. Professional and Trade Licenses – If you are into real estate, or if you are operating an occupation based business such as a child care centre, then you would need to obtain a professional and trade license. A complete list of businesses requiring this license can be obtained easily from officials in your city.

3. Home Occupation Permit – Home based businesses may require an additional permit called the ‘Home Occupation Permit’ or if this does not apply to your city, then a Zoning Permit which states that it is all right to have a home-based business in the locality you are established in.

4. Sales Tax Permit – If your business includes selling goods online or offline, which are taxable by law, then you will have to obtain a permit for selling these items before you establish your business.

5. Health and Safety Permits – Depending on where your business is located, it may be needed for you to obtain a permit from the Health and Safety department. If you business requires use of flammable materials, or if you are a restaurant owner serving food, then you need to have clearance from the authorities before setting up stall.

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