If you’re looking to launch a business in Arkansas, it’s important to ensure you have all the proper licenses and permits to operate in the state.
Having the correct licenses allows you to do business not only in the state but in the local municipalities where you operate.
In this comprehensive guide, we will identify the types of Arkansas business licenses and permits you may need, the differences between licenses and permits and the steps to complete to ensure your business is covered.
Small business licenses and permits are essential elements of running a company not only in Arkansas but in states across the nation.
The specific types of business license and permits can vary widely and often depend on the type of business you own. Certain businesses require more extensive permits and licenses or specific documentation to ensure that you are following state and local laws and regulations.
Many people use licenses and permits interchangeably. However, the two types of legal documents are quite distinct.
Licenses typically give you permission to do something, such as operate a business in the state . Licenses often require you to complete a registration process and, in some cases, pass a professional exam that demonstrates your competency. Licenses may either be permanent, expire after a certain amount of time, and may require professional continuing education or further exams.
Permits are authorizations, often at the local level, that allow a business to complete certain activities. Permits may involve an inspection by a local department and/or paperwork filings.
Permits typically are only good for a finite period and must be renewed. Often, they involve safety issues. Typical examples include building permits or zoning permits.
As noted above, it’s important to understand what you will need for permits at the Arkansas state, county and local levels.
Licenses and permits will depend on the kind of business you plan to operate and the activities that your business will undertake.
While some states require a general business license, that is not the case in Arkansas.
However, any business that plans to sell goods or services in the state will need a sales tax permit, called a seller’s permit. This permit authorizes you to operate and collect the Arkansas sales and use tax, which allows you to collect sales taxes. In addition, if your business is located outside the state and has more than $100,000 in sales or 200 transactions in Arkansas, you must also obtain the sales tax permit and register as a remote seller.
A good place to start is the state online portal. There, you can search for “license” or “permit” and find specific requirements for your business type. Additional keyword searches related to your business, e.g. barbershop or child care will identify additional resources for what you need to obtain.
You will also want to research the county and city websites to determine what you’re responsible for at the local level.
While states regulate some activities related to business operations, your company may also be subject to federal licensing regulations.
It’s a smart idea to check with the U.S. Small Business Administration to identify required federal licenses and from which agencies.
For example, if your Arkansas business makes, wholesales, imports or sells alcohol in retail locations, you will need permits from the federal Alcohol and Tobacco Tax and Trade Bureau and the state Alcohol Beverage Control agency.
Here is a step-by-step guide to obtaining Arkansas business licenses and permits.
The first step is to know what state and local licenses and permits you may need.
AR.gov is the first step to finding potential state permits and licenses. The Arkansas Small Business and Technology Development Center is another excellent resource for information about state licenses and permits.
The most common Arkansas licenses and permits include:
In addition to the alcohol example above, here are some of the most common business activities that require specific federal business licenses and permits and the agency or bureau that is responsible, for example:
Let’s walk through the process of obtaining a license at the state or local level.
For example, in Arkansas, a license is required to run a child care facility. You will first need to register online with the Department of Human Services Licensing Unit. The form asks for the following information:
The application also requires a diagram of the facility, fire and health approvals, name of the director and their qualifications, names and contact info on caregivers, zoning approval, Arkansas Manufactured Home Commission approval and rates.
At the federal level, the process is similar. You will need to go to the agency site and fill out an application. For an alcohol business, the form asks the following:
Applications can take weeks to months to be reviewed and approved. It’s important to obtain contact information, tracking numbers and other tools to track the status of your application and to reply promptly to any inquiries.
Different licenses and permits have different terms and lengths. Be sure to track when licenses and permits expire and ensure they are renewed on time. Otherwise, you may be subject to fines or other penalties.
Owning an Arkansas business is an exciting opportunity. Ensuring your business can run smoothly requires careful research and applying for the necessary licenses and permits at the federal, state and local levels.
Failing to obtain a license means your business could face fines and sanctions. Federal and state authorities can close your business and seize assets in some cases.
Even as a sole proprietor, you may be required to obtain licenses, such as a sales tax permit, to operate. Always check with state and local authorities.
Arkansas does not require a state business license to operate.
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