There’s a lot to do when you’re starting a small business. Among the many items to take care of, make sure you don’t overlook any Massachusetts business licenses and permits that your business might need. There’s a range of small business licenses and permits that you may need.
Small business licenses and permits are commonly required by local, state and federal governments. The purpose of licenses and permits is primarily to maintain public health, safety and welfare, although it’s also to collect taxes and fees in some cases.
What licenses and permits you’re required to obtain depend on your business’s location, activities, industry and other details. There are a variety of small business license and permit requirements in Massachusetts.
Do make sure you obtain any that your business is required to have. Not getting a required license or permit could result in fines, other penalties, and possibly even temporarily closing your business.
While they’re sometimes used interchangeably, business licenses and permits often serve different functions:
Your business could need to apply for multiple permits if it’s regularly doing something that requires a permit. You usually only need to apply for a license once, although many have to be renewed.
Consider an owner-operator of a commercial truck as an example. The owner-operator needs to maintain a commercial driver’s license, which requires renewal every few years. If they carry oversized loads that require closing local roads, the owner-operator might have to apply for a permit each time they transport such a load.
Types of business licenses and permits you might need for your Massachusetts business
Businesses can be subject to license and permit requirements at all levels of government. Check whether you need any state, local or federal licenses or permits for your business.
Maine doesn’t have a statewide general business license requirement. You’ll likely need to register for collecting sales or use tax, depending on what your business sells. You can easily and quickly register for sales and use tax through MassTaxConnect, and approval is immediate after you complete the application with the Massachusetts Department of Revenue.
Sometimes this is called a “sales and use tax license,” or a “seller’s permit.” Massachusetts simply refers to it as registering for sales and use tax, though.
You might need to obtain specific Massachusetts business licenses or permits if your business operates within certain industries. Certain businesses need a liquor license, auto dealer registration, or real estate license, for instance. There are many other state licenses required for other industries.
For state information on small business licenses and permits, the Business Licenses & Permits page on Mass.gov is a good resource. The Division of Occupational Licensure (DOL) has a list of the various professions that require a state license.
Many of the towns, cities and counties in Massachusetts have their own licensing requirements. For instance, Boston has its own city license requirements for everything from pool halls to gas stations. Many other municipalities and counties will have specific requirements for certain industries.
In some cases, cities or towns might require a small business license or permit just for conducting business within their jurisdiction. A local general business license is usually easy to obtain, and typically doesn’t cost much.
To find out what local requirements your business is subject to, contact your local clerks. Your town clerk or city clerk should be familiar with any municipal requirements, and the county clerk will know about county business licenses and permits. Be sure to check with each jurisdiction where your business is located or offers services.
Federal licenses and permits might be required if your business activities are regulated by a federal agency. Most small businesses don’t need a federal license or permit, but there are a good number of regulated industries.
Some of the federally regulated industries are agricultural production, aviation, alcoholic beverages, commercial fisheries, fish and wildlife, firearms, explosives and ammunition, maritime transportation, mining and drilling, television and radio broadcasting, transportation and logistics, and nuclear energy.
The Small Business Administration (SBA) maintains a list of what industries may have federal business license or permit requirements. If your business needs to apply for one, you’ll do so through the overseeing agency.
Check with the appropriate government agencies to find out what small business licenses and permits you need.
Review the SBA’s list of federally regulated industries, and reference both Business Licenses & Permits and the Division of Occupational Licensure for state requirements. Checking local requirements will probably require reaching out to the town/city and county clerks.
Some small business license and permit applications are quick and easy, while others can take days or weeks to get approved. For example, you can register for sales and use tax immediately. Getting a federal license in any industry is bound to be a longer, multi-step endeavor.
Each license or permit application should have instructions on how to complete the application process. There might be additional resources online, and you can always contact the agency that’s providing the license.
Be sure to also budget for application fees. Some applications are free or cost very little, but licenses for certain industries can be quite expensive. Fees can reach into the 4-figures for highly regulated industries. Most small businesses don’t need to pay much, though.
Processing times for licenses and permits vary. Expect most to take a few days or perhaps weeks, but it’s possible that complications extend processing time. You can always contact the agency to ask how long typical processing times are.
Many small business license and permit applications can be tracked online. If you want and update and the status isn’t available online, contact the agency or clerk. It’s fairly common for local licenses and permits to not have online tracking available.
Should you need faster processing, expedited service might be available for an additional fee.
Many licenses and permits require renewal, either annually or at some other interval. A few, such as Massachusetts’s sales and use tax registration, don’t expire.
When you initially apply for a small business license or permit, check whether it needs to be renewed. Mark any that do on the calendar. You won’t want to let a licensee or permit lapse.
Before your business officially begins operating, make sure any required Massachusetts business licenses and permits are in place. You’ll want all of these formalities taken care of before the first day of operations.
Operating without required licenses and permits can result in fines, penalties, legal action, and even business closure if the violation is serious enough. It’s important to get all of the licenses and permits that your business needs.
Should your business’s license or permit lapse because it wasn’t renewed, renew the license as quickly as possible. You might be able to renew before major penalties are assessed. If you delay, those penalties can compound each day that your business isn’t officially licensed.
Massachusetts doesn’t have a general business license requirement, so there’s not a state license that all sole proprietors must obtain. You probably will need to register for collecting sales and use tax, however. This can be done quickly online, through MassTaxConnect.
Additionally, sole proprietors may still need to obtain other licenses and permits depending on their business activities and location. Check with the appropriate agencies and clerks to see whether any other licenses or permits apply to your work.
Since Massachusetts doesn’t have a general business license, there’s no one license that all businesses must renew. You don’t have to renew your sales and use tax registration.
Keep in mind that any other small business licenses or permits may have renewal requirements. Check specific requirements when initially applying.
Processing times for small business licenses and permits vary. They may take minutes, days or weeks, with few taking more than a couple of weeks.
This portion of our website is for informational purposes only. Tailor Brands is not a law firm, and none of the information on this website constitutes or is intended to convey legal advice. All statements, opinions, recommendations, and conclusions are solely the expression of the author and provided on an as-is basis. Accordingly, Tailor Brands is not responsible for the information and/or its accuracy or completeness. It also does not indicate any affiliation between Tailor Brands and any other brands, services or logos.
Products
Resources
@2024 Copyright Tailor Brands