Virtual Office Business License: Everything You Need to Know
Virtual office business licenses that entities need include general business permits, weights and measures permits, and health inspection certificates.3 min read
Virtual office business licenses that entities need include general business permits, professional or occupational permits, weights and measures permits, and health inspection certificates. In addition, the business may need to comply with residential zoning ordinances and Homeowners Association Agreements.
Virtual Offices Businesses and Licenses
For a business with virtual offices to qualify for a license or permit, it must meet these requirements:
- The licensing authority will likely require even virtual businesses to have some kind of physical presence. The business must have a street address in the state. Your home address or virtual office address might suffice for this purpose. This address will also come in handy when receiving mail and notices from customers and the government.
- It must be registered with the state. The registration process varies from state to state and based on the type of business.
- The business may be required to have an Employer Identification Number (EIN). The IRS assigns the EIN, which is a unique identifier for the business. An EIN also enables businesses that have employees to withhold and pay taxes to the state and the IRS. You can obtain this number from the IRS website.
Contrary to popular opinion, online businesses require more or less the same permits and licenses as other businesses. In fact, some online businesses and those that operate from home must get other permits and licenses in addition to the ones that other businesses have.
Typical Licenses Businesses Need to Operate
Online businesses are required to have a number of licenses. Some requirements are common to all businesses while others are unique to online businesses. Licenses and permits that are common to all businesses include:
- General business license: This license is normally issued by the county or city where the business is located. The license helps the authorities collect revenue and enables them to regulate local business practices.
- Sales tax registration: If the business is involved in selling goods, it must collect sales tax from customers and forward the tax to the state authorities. Businesses that sell online are not exempt from this requirement. Some service businesses also qualify for this tax.
- Professional or occupational licenses: Businesses that provide professional services and those involved in services that have public health significance must have specialty licenses. Examples of business types that may qualify for these licenses are law firms, clinics, engineering firms, and massage parlors.
- Weights and measures registration: A weights and measures registration is normally required for businesses that weigh items as part of their operations.
- Health inspection certificate: These kinds of licenses are needed for businesses involved in selling food products. Businesses in the food industry are normally required to undergo checks for the licenses to be renewed.
Licenses Specific to Home-Based Businesses
In most states, businesses operated from home must have specific permits that other businesses are not required to have. These permits include:
- Home occupational permits: Home occupational permits are normally required to protect residents in residential areas from harmful business activities. The certification process for this permit focuses on ascertaining whether the business will be a nuisance to neighbors. This permit can be revoked if the business contributes to a significant increase in the traffic, noise, dust, and other problems associated with business activity. The permit may also specify the maximum number of space that the business can occupy.
- Signage requirements: Some local authorities place restrictions on the number and type of signs that businesses located in residential areas can use. Verify with authorities before installing any type of sign at the premises of a business located in a residential area.
- Zoning restrictions: Businesses located in a residential area need to comply with the zoning ordinances of that area. In some residential areas, businesses in certain fields, like manufacturing, are prohibited. In some cases, modifications to your business may enable you to comply with zoning requirements.
- Homeowners Association Agreements (HOAs): HOAs are not licenses, but they may limit the ability of a business to operate from home. Many communities have HOAs that limit the activities that a homeowner can do at home. Check that the kind of business you are doing at your home is compatible with such agreements.
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