Opening a business can be a complicated process. Whether you’re planning to start a bakery, open an accounting practice or go in a different business direction, you need to have a business plan, line up funding and make sure you have all the necessary licenses in order. Getting a business license in Pennsylvania is relatively simple, though, and some businesses may not even need a license.
Do You Need a Business License in Pennsylvania?
Several factors determine whether or not you need a business license. Pennsylvania doesn't have a statewide business license required by all businesses. Instead, certain business are required to obtain professional licenses through the Pennsylvania Licensing System, which is an online portal run by the Department of State.
This doesn't mean you don't need to file any paperwork with the state. You will need to make sure you have your business registered for tax purposes, any required permits and any applicable professional licenses. The first step in determining how to register your business with the state for tax purposes is to decide on the appropriate business structure. Some common structures include a sole proprietorship, a partnership or a corporation.
Once you’ve decided on your business structure, you will need to register the business for tax purposes. The exact forms to complete to register your business for tax purposes depends on the type of business you have. In many cases, to accomplish tax registration, fill out form PA 100 and submit it to both the Department of Labor and Industry and the Department of Revenue. You must also register your business structure with the Pennsylvania Department of State unless your business is a sole proprietorship operating under the owner's legal name.
In many cases, you will also need an employer identification number, or EIN, which you can obtain through the Internal Revenue Service. If you’re planning to work with contractors, you will need to register with the state attorney general. If your business is going to have employees, you will need to register with the Pennsylvania Department of Labor and Industry and follow the requirements for workers' compensation and tax withholding.
Obtaining Professional and Local Business Licenses in Pennsylvania
Depending on the type of business you’re planning to open, you may need a specific professional license from the Pennsylvania Department of State. Some professions that need special licenses include landscape architecture, real estate agents, car dealers and cosmetologists. You can obtain many of these licenses through the Pennsylvania Licensing System's website. You can use the portal to obtain a new license or renew a professional license you currently hold.
Your locality may also have business licensing requirements. Philadelphia, for example, requires businesses to have a commercial activity license. The town of Reading requires a business privilege license if you do business there. Contact your local city government to find out whether you need a business license.
Other Things to Consider When Opening a Pennsylvania Business
Most businesses need to register their business name with the Pennsylvania Department of State. You will need to register the legal name of your business or company. If you plan to use a business name that's different from your company's legal name, you will need to register that fictitious business name as well. You also need to officially publish notice of the ficticious business name in two separate newspapers in the county in which the business will be located. One of the newspapers must be a legal paper. The notice needs to appear once in each paper. You can find an appropriate legal newspaper by contacting your county bar association or courthouse. Publish the fictitious name before you file for a fictitious name or as soon as you complete and file the application. You may also need to take steps to protect your intellectual property, including trademarks and trade names. You can register the trade name you want to use with the department of state.
- Nolo: How to Get a Small Business License in Pennsylvania
- SBDC Pennsylvania: Business Checklist
- Department of State: Welcome to the Pennsylvania Licensing System (PALS)
- City of Philadelphia: Business
- ReadingPA.gov: Starting a Business - Quick Guide
- Pennsylvania Department of State: Fictitious Names
- PA Business One-Stop Shop: Register Your Business
- Restaurants and massage parlors also need to obtain a license from the health department.
Melinda Hill Sineriz is a freelance writer with over a decade of experience. She specializes in business, personal finance, and career content. She has worked in sales and has managed her own business for more than a decade. She has also written content for businesses in various industries, including restaurants, law firms, dental offices, and e-commerce companies. Learn more about her and her work at thatmelinda.com.