A crucial step in starting a limited liability company (LLC) in Delaware is acquiring all the necessary licenses and permits. Depending on your business, you may need them at the federal, state, and local levels.
This is a must, as without them you could face major penalties and even business closure. Lucky for you, this guide lays out all you need to know to ensure you’re in full compliance in Delaware.
Which Department Issues Business Licenses and Permits?
In most states, a number of agencies and departments issue licenses and permits depending on the industry and location. In Delaware, the Division of Revenue issues most licenses, while the Division of Professional Licensing issues some as well.
In most states, you need to obtain a sales tax license if you sell taxable goods or services, but Delaware has no state sales tax.
You do, however, have to get a general business license in Delaware.
Check with your local governments about licenses and permits at the county and municipal levels.
Federally, different departments oversee different industries. Licenses and permits are generally industry-specific, except for health permits from the Occupational Safety and Health Administration (OSHA). If you run a farm, your business may need a license from the U.S. Department of Agriculture.
If your business sells fireworks, you’ll have to register with the Bureau of Alcohol, Tobacco, Firearms, and Explosives. Most industries, however, do not require licensing at the federal level.
The Small Business Association (SBA) has put together a handy guide that details which licenses and permits are needed for various types of businesses.
Common Business Licenses and Permits
Here are some common licenses and permits you may need:
If your industry is regulated by a federal agency, you’ll need to be licensed by that agency. Federal agencies that may require you to be licensed include:
- The Department of Agriculture
- The Alcohol and Tobacco Tax and Trade Bureau
- The Bureau of Alcohol, Tobacco, Firearms, and Explosives
- Department of Transportation
Common licenses at the state level include:
- Industry-specific licenses for certain professions and industries, such as construction, plumbing, electrical, childcare, food handling, liquor, architecture, and finance
- Health licenses and permits
- Doing business as (DBA) permit if you’re doing business using a name other than your LLC name
- Sales tax permit
At the municipal or county level, you may need:
- Building and zoning permits
- Health licenses and permits
- Fire permits
- Sign permits
How to Obtain a Business License in Delaware
In Delaware, you’re required to get a general business license. But:
- To get a general business license, visit the Department of Revenue and complete the online application.
- Unless you’re operating as a sole proprietorship or partnership, you’ll need to register your business entity with the state, usually as an LLC or a corporation. Do so online on the Division of Corporations website.
- Other licenses can be applied for with specific departments. In Delaware, if you have a restaurant, you’ll need a food establishment license. For this, you’ll apply with the Department of Health and Social Services.
- Check with your local governments for licenses and permits you may need at the local level.
How Much Does a Business License Cost in Delaware?
License and permit fees vary. A general business license, for instance, costs $75 per location in Delaware, while forming an LLC costs $90. A food establishment permit for a public eating place costs $100.
Do Licenses and Permits Have to Be Renewed?
Some licenses and permits need to be renewed annually. A general business license in Delaware needs to be renewed annually, as do food establishment permits.
For other licenses and permits, check with the issuing departments for renewal requirements.
Obtaining licenses and permits is a critical step when starting an LLC in Delaware, so make sure you check with state and local government offices and fully comply with their requirements. If you operate without the proper licenses and permits, you could face steep fines or even the closure of your business.
If you’re unsure of state or local regulations and need help, consult with a business attorney, as proper licensing is an absolute must.