To answer the question: How much does a business license cost in Texas? You must first ask 2 others:
Does your business need a license?
And if so, which one?
We ask which one because Texas doesn’t implement a general business license, so there isn’t a fixed cost. Instead, you must apply for separate business licenses (and often permits) relative to your niche and location!
That can be confusing, and if you trade without the appropriate license, also illegal!
Fear not, though, because this post untangles the Texas web of business license requirements so you know which you need, where to apply, and how much they cost.
Empowering you to start your business confidently and within budget.
Texas doesn’t have a one-size-fits-all state general license, but when starting your business, you might need several permits and licenses at the federal, state, and local levels, including municipal, occupational, and sales and use tax license, a resale certificate, or an environmental permit relative to your location and business type.
But we still need to answer our question!
And we do that by focusing on you.
All Texas counties and cities have specific license (and permit) requirements, and the Lone Star State regulates some occupations and not others, so you must apply for the licenses (and permits) relevant to your business from the correct government department.
However, a Texas general business license works differently, and that’s great news for you.
For example:
Suppose you register a business as a sole proprietor with your county clerk’s office or an LLC with the Texas Secretary of State office. In that case, the document you receive satisfies the Texas State business license requirement and contains your general business license number (IE., your tax ID).
More exciting news!
You can then use the general business license number on that document to apply for a reseller license, a resale certificate, or other licenses relevant to your business needs.
Texas general business registration costs:
Check out the Texas Economic Development Office for further information on general business license requirements
Okay, wonderful, that clears up the general business license; now, let’s look at those specific to your location and niche:
Counties, cities, towns, boroughs, and parishes issue various local licenses and permits depending on your industry; for simplicity’s sake, I’ll refer to them as municipal licenses.
Of these, 2 types exist.
For example, food truck operators and restaurant owners need an industry-specific food handling permit. For entrepreneurs leasing or purchasing real estate, zoning permits apply.
Note:
Entrepreneurs operating in multiple cities or counties might need a general municipal business license for each location.
How much does a Texas Municipal business license cost?
Contact your local county clerk’s office to find your municipal business license fees.
An occupational license (also called licensure) is a government regulation that requires specific professions and vocations to meet minimum requirements (like education, experience, and competence) to operate in their profession.
These include business activities that expose people to potential hazards or require extensive training and include:
For example:
Aspiring real estate agents must apply to the Texas Real Estate Commission for a realtor’s license, which costs between $1000 and $1500.
You can learn more about Texas occupational license requirements and costs on the following government website:
Sales tax is a percentage that most US states add to specific products and services.
Entrepreneurs who sell taxable goods in Texas (including foreign LLCs) must collect and pay sellers’ tax by registering with the Texas Comptroller for Sales and Use tax department.
Use the Texas Online Tax Registration Application guide to see if you need a seller’s license and how to apply.
For more sales and use tax information, read these resources:
How much does a Texas sales tax license cost?
Texas does not charge for a sales tax permit.
Business owners who buy goods to resell must have a Resale Certificate (aka Reseller Permit) to avoid paying sales and use tax.
Read the Texas Comptroller Resale Certificates FAQs to learn more about a resale certificate and how to get one.
How much does a Texas resale certificate cost?
Resale certificates are free in Texas.
Entrepreneurs who own businesses that could negatively affect the environment need permits from relevant Texas environmental agencies, like the Texas Pollutant Discharge Elimination System (TPDES).
How much do Texas environmental permits cost?
For a complete list of Texas environmental permits and fees, visit the Texas Commission on Environmental Quality website.
Let’s finish with federal license requirements and costs.
Businesses operating in federally regulated sectors need a federal license or permit.
Those sectors include:
Entrepreneurs operating in a federally regulated sector must apply for a license from the agency relative to the activity. For example, agricultural businesses would contact the U.S. Department of Agriculture.
For further information on Federal business license fees, visit the Small Business Administration website.
Fortunately, getting a Texas business license is the simple part of this endeavor. Once you know which license you require and the relevant agency, you only need to file your application and pay the fee.
However, you’ll likely need to provide the following information:
It takes 2 to 3 weeks to receive your license (by post) after the submission date.
How to find the licenses your business needs:
As we now know, you may as well ask, How long is a piece of string? Because the cost of a business license depends on which you need it and your location.
That said, Texas business license costs range from €15 to €1500!
Yup, that’s about as helpful as an umbrella in a hurricane.
Yes, every US state requires businesses to register at the state or local level to get a tax ID; in Texas, it can be both, depending on your industry.
Most businesses in Lone Star State require one or more licenses and permits.
It depends on what business you want to start. You can learn all about small business expenses that apply to any US state in our small business start-up costs post.
No.
An LLC refers to a specific business structure that provides its members with liability protection. In contrast, a business license allows you to operate in a particular Texas municipality.
The owners might do it depending on the business they are in.
For example, a sole proprietor that sells taxable goods requires a sales and use tax business license & if they want to avoid paying sales tax to their providers, they’ll also need a release certificate.
You apply to the relevant local authority or government agency for most business licenses and permits.
However, suppose you start a legal entity (like an LLC) by registering with the Texas Secretary of State’s office but don’t need specific licenses or permits. In that case, your registration approval is your business license.
Remember, you get the answer to the question ‘How much does a business license cost in Texas’ by answering the following 4 questions:
Once you answer those and apply to the correct local, state, and federal departments, you’ll know how much your business license will cost in Texas.
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.
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