What Are Businesses That Do Not Require a License?
There are many businesses that do not require a license or a permit but many experts debate whether an optional permit/license carries a competitive advantage.3 min read
Updated July 17, 2020:
There are many businesses that do not require a license or a permit. In fact, most independent contractor positions and sole proprietorships don't require a permit or a license unless they relate to a specific type of professional license. However, many experts do debate whether an optional permit or license carries a competitive advantage.
Freelance writing is one of the most popular types of independent contractor professions. Freelance writers are not required to carry a professional license, and most will report their income through their Social Security number. Most freelance writers will work with an independent organization or agency and will file a W-9 with each business they work with.
Many independent contractors work in the field of web design. Most web designers are not required to carry a professional license. In order to report their income to the Internal Revenue Service (IRS), they will need to file a W-9 with all of the companies they work with. Web designers will usually provide a customized design for their customers or offer pre-made templates.
Hobby breeders are dedicated to the preservation of a particular breed of dog or cat. Large organizations in the breeding industry are required to carry a valid license, but hobby breeders are exempt as long as they're breeding five female dogs or less. Also, breeders aren't forced to work solely with dogs. Many will work with other species, such as:
- Sugar gliders
When breeding exotic or rare dog breeds, hobby breeders can earn as much as $24,000 per year with five breeding females.
The craft industry has become popular over the last few years. Many small business owners are making handmade and vintage products and selling them on craft websites. It's extremely affordable to pay for the listing and sell crafts to people all over the world. And successful individuals may soon realize that their hobby has become a full-time business.
The main benefit of this business model is that because the items are sold on the internet, there is no need for a brick-and-mortar building. This saves owners a lot of money in overhead expenses. Crafters may sew, paint, release zines, or knit and then sell their handmade goods on a website.
Used Book Dealer
Another successful online business that doesn't require a license is a used book dealer. The internet has created a marketplace that makes it possible for everyone to get into the used book business. Diligent dealers may sell a large volume of titles while college students are able to resell textbooks. Customers looking for a deal are the type of clientele the business is looking to attract. Dealers that are able to price their books at a competitive rate are able to supplement their income, and in many cases create enough cash flow to evolve into a full-time business.
In order to generate income, many people have decided to become either a consultant or an independent business operator with businesses such as Mary Kay or Avon. Distributors, for nearly all types of products, are looking for individuals to sell their goods to colleagues and friends. It may take a special person to be successful in this line of work, but the overhead is low and the products are usually made of a high quality.
App developers have become increasingly popular in the last few years. People looking to specialize in developing and scripting apps are in extremely high demand. Software engineers and developers can earn a great living if they help to create a useful and stable application. Also, many sole proprietors are able to generate additional income by developing multiple apps.
Businesses That Don't Require a Business License
While there are plenty of businesses that don't require a permit or license, it may be beneficial for the growth of the company to obtain a specialized license before opening the business. In many cases, tax credits and deductions may only be taken by a professionally licensed business.
To ensure they're operating in a legal and responsible manner, entrepreneurs should always perform their due diligence prior to starting a business. For example, a Chicago business license is required to engage in, conduct, maintain, manage, or operate any business in the City of Chicago. However, some business activities that are regulated by the state may be exempt from city licensing.
If you need help with businesses that do not require a license you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.