Key Takeaways

  • Business structure matters: Choosing the right legal entity (LLC, corporation, partnership, or sole proprietorship) is one of the most important decisions when doing business in Florida, as it affects taxes, liability, and compliance obligations.
  • Registration is required: Most businesses must register with the Florida Division of Corporations, and those using a fictitious name must file a DBA.
  • Licenses and permits vary by industry: State, county, and municipal governments may each require specific permits, such as zoning, health, occupational, or professional licenses.
  • Tax compliance is complex: Florida businesses may face sales tax, corporate income tax, unemployment tax, and other industry-specific taxes.
  • Employer responsibilities: Hiring employees comes with legal obligations, including reporting new hires, verifying work eligibility (I-9), withholding payroll taxes, and maintaining workers’ compensation insurance.
  • Additional compliance areas: Foreign businesses, zoning laws, professional regulation, data privacy, and employment laws also affect companies operating in Florida.

Doing business in Florida requires several initial steps. Perhaps the most exciting step is choosing a name for your company. You'll want to come up with something unique that explains the type of business you're conducting. After that, you'll need to decide how to form your company, i.e., a sole proprietorship, a partnership, a corporation, or an LLC (limited liability company). Whether you're running an online business, an at-home business, or a brick and mortar, your first steps will be to register with the state and county and open a bank account.

Let's dive a little deeper into doing business in Florida.

Types of Taxes in Florida

Anyone who opens a small business in Florida must register for an identification number. You'll also need to secure a permit or license based on the type of taxes that line up with the services you're offering. Some businesses will be responsible for unemployment taxes, corporate income taxes, and sales and use taxes. Beware of other unforeseen taxes, too, such as a communications services tax, a fuel tax, or a pollutants tax. It all depends on the type of business you're establishing. The Florida Department of Revenue's website contains a wealth of information, as well as pertinent registration forms. 

Understand State and Local Tax Obligations

In addition to the primary taxes mentioned, businesses operating in Florida should be aware of industry-specific tax obligations that may apply based on their operations, products, or services. For example:

  • Sales and Use Tax: Collected on the sale or lease of goods and certain services. Remote sellers and marketplace facilitators with nexus in Florida are also required to collect and remit sales tax.
  • Corporate Income Tax: Most corporations doing business in Florida must file a corporate income/franchise tax return, typically due on the first day of the fifth month following the close of the fiscal year.
  • Unemployment Compensation Tax: Employers must pay reemployment (unemployment) tax if they pay wages of $1,500 or more in a calendar quarter or have at least one employee for part of a day in 20 weeks during a calendar year.
  • Excise and Specialty Taxes: Certain industries, such as fuel distribution, telecommunications, and environmental sectors, face additional taxes like motor fuel tax or pollutant discharge tax.

Businesses should consult the Florida Department of Revenue for guidance and stay current with changes in tax laws to avoid penalties.

Permits and Licenses

The state of Florida requires all businesses to acquire appropriate permits and licenses. Just like your taxes, your permits and licenses will vary based on your location and the type of business you're operating. Here are some of the most common permits and licenses business owners file for:

  • Business license
  • Tax permit
  • Building permit
  • Occupational permit
  • Alarm permit
  • Zoning permit
  • Health permit

Zoning, Land Use, and Local Approvals

Before launching operations, businesses should verify that their chosen location complies with local zoning and land-use regulations. Zoning laws dictate what types of businesses can operate in specific areas — for example, commercial, industrial, or residential zones — and may limit business hours, signage, or property modifications.

  • Zoning Variances: If your business plan doesn’t conform to current zoning rules, you may need to apply for a variance or special use permit.
  • Environmental and Building Codes: Businesses involved in manufacturing, waste disposal, or food services may face additional environmental and construction compliance requirements.
  • Home-Based Businesses: Florida law allows certain home-based businesses but imposes restrictions on noise, traffic, signage, and customer visits.

Confirm compliance with local planning departments and obtain necessary approvals before signing leases or investing in property improvements.

Florida Division of Corporations

In Florida, the following entities must register with the Division of Corporations:

  • Non-profits
  • Corporations
  • LLCs
  • Partnerships

If you're planning to run a sole proprietorship, you don't need to go through the registration process. However, you will be required to use your personal name as the business name. If you don't like the idea of using your own name, then you must register a fictitious name with the same Division of Corporations. Your use of a fictitious name means you'll be "doing business as." 

Foreign Businesses and Out-of-State Entities

If your company was formed outside Florida but plans to conduct business within the state, it must register as a foreign entity with the Florida Division of Corporations. This process typically involves:

  • Filing a Certificate of Authority.
  • Providing a certificate of good standing from the state of formation.
  • Appointing a registered agent located in Florida to receive legal notices.

Operating without registration can result in fines, inability to bring lawsuits in Florida courts, and other legal consequences. Foreign entities are also subject to state tax, licensing, and regulatory requirements once registered.

Filing Taxes in Florida

It's advisable to retain all of your employment tax records. You'll want to keep your employer identification number (EIN), employee data, and tax deposit information on record at all times. The IRS has a wealth of information on their website regarding employment taxes and additional items you'll want to maintain in your records. Start maintaining accurate records early on. If you do this, you'll be able to:  

  • Track your growth
  • Monitor your deductibles
  • Track your receipts
  • Prepare future tax returns

Recordkeeping and Compliance Best Practices

Maintaining organized, up-to-date records is critical for tax and legal compliance in Florida. Businesses should keep copies of:

  • Tax returns and payment confirmations.
  • Payroll records and withholding statements.
  • Invoices, receipts, and expense documentation.
  • Annual reports and corporate filings.

Florida requires most entities to file an annual report with the Division of Corporations by May 1 each year to maintain active status. Missing this deadline can result in late fees or administrative dissolution. Using accounting software and consulting a tax professional can help businesses stay compliant.

Hiring Employees

It will be your responsibility to provide employee information within 20 days to Florida's Directory of New Hires. This includes their name, address, and social security number, and can be done online at the Florida New Hire Reporting Center. 

Each new hire must complete an I-9 form. This provides proof of their eligibility to work in the United States. It's important to have this form submitted within three days of their start date. Be sure to keep a copy on file for your own records, whether the new hire is a citizen or a non-citizen. You can find this form on the United States Citizenship and Immigration Services website. 

Along with the I-9, new employees will need to sign a W-4 form. This is required for tax withholding exemptions. Once signed, you can forward the W-4 to the IRS. You'll want to maintain tight records regarding taxes withheld and wages paid to each employee. You'll submit the tax and wage information from the previous year to the government via a W-2 form, or a Wage and Tax Statement.  

As soon as you have employees on staff, you'll also be required to pay an unemployment compensation tax. Those taxes will go into the UC Trust Fund. This is where partial payments are drawn from when workers are unable to find work. 

You'll also be responsible for worker's compensation insurance. This is available through the Florida Workers' Compensation Joint Underwriting Association. Alternatively, you can pursue a self-insured method. 

Employment Law and Workforce Compliance

Florida employers must comply with both state and federal employment laws to avoid liability and potential legal disputes. Key requirements include:

  • Wage and Hour Laws: Florida’s minimum wage is adjusted annually; as of 2025, it is scheduled to increase under a constitutional amendment until reaching $15/hour by 2026. Employers must also comply with overtime rules under the Fair Labor Standards Act (FLSA).
  • Anti-Discrimination Regulations: Federal laws (such as Title VII and ADA) and state laws prohibit discrimination based on race, gender, age, disability, and other protected categories.
  • Workplace Safety: Employers must follow OSHA guidelines and report workplace injuries or illnesses promptly.
  • Data Privacy and Record Security: If handling customer or employee data, businesses should implement cybersecurity policies and comply with Florida’s data breach notification laws.

Following these regulations helps businesses build a compliant workforce and reduces legal risks.

Frequently Asked Questions

  1. Do I need a business license to operate in Florida?
    Yes. Most businesses require state and local licenses or permits based on the type of business and location.
  2. What is a registered agent, and do I need one?
    A registered agent is a person or entity designated to receive legal documents on behalf of your business. All Florida entities must appoint one.
  3. Can an out-of-state business operate in Florida?
    Yes, but it must register as a foreign entity with the Division of Corporations and comply with state tax and regulatory laws.
  4. What happens if I miss the annual report deadline?
    Missing the May 1 deadline can result in late fees and potential administrative dissolution of your business.
  5. Are there special rules for home-based businesses?
    Yes. Florida allows home-based businesses but limits signage, traffic, and certain activities to maintain neighborhood character.

If you need help doing business in Florida, 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.