The purpose of both licenses and permits is to allow you or your business to do something and, in fact, the line between them is a bit blurred. A permit is a document that authorizes you to do something, while a license is defined as a permit from an authority that allows you to own or use something. Both imply some kind of greater public purpose, which generally in in regards to safety.
As a business owner, you will require different licenses and permits to properly run your business. Operating your business without these documents would be incredibly detrimental to your business as a whole. In addition to a comprehensive Business Insurance package, make sure you will have the right documentation to run your business.
Competence and Inspection
A license is granted as permission to do something or use something. In some cases, licensing is granted after some kind of test to make sure that the person receiving the license is capable of doing the activity. A business license does not typically require any kind of examination, although individuals in many professions are licensed after testing, such as doctors and psychologists.
Licenses to do business can be granted by a government agency. Activities which usually require a license include driving or engaging in certain occupations, and these often require passing an exam. Licenses can also be sold by individuals or companies. The owner of a trademark or copyright might give someone a license to use that intellectual property in exchange for compensation and possibly royalties.
A permit is a type of license that’s granted by a government agency. Permits regulate safety and are typically granted following an inspection for building occupancy and health in food service places. Note that fire safety inspections are common. The first step in getting a business license or permit is to know which your business requires.
These are the main types of licenses and permits.
- Federal: Businesses operations that are regulated by federal agencies must obtain permits or licenses. A business selling firearms must have a federal firearms sale permit. The SBA also has a list of federal agencies requiring licenses or permits and how to obtain them. You can contact each agency through its website.
- State: Some state licenses or permits are required for all businesses. A state tax permit is typically required for any entity selling products or services that is subject to state sales tax. You can find more information about general state licenses and permits at state regulatory agency sites. Other state licenses are for professionals such as veterinarians, dentists, cosmetologists, barbers, doctors, and more. Contact your state’s professional society for information about licensing if you’re in a regulated profession.
- Local: Just about every locality in the U.S. has specific licensing and permit requirements. Most cities have zoning permits, health permits, and construction or building permits.
About The Rubin Group
Based in New York, The Rubin Group provides insurance in most of the 50 states. Our full-service insurance brokerage provides insurance and risk management services to individuals in all income brackets and businesses of all sizes and types. We understand that every client has unique coverage requirements, and we are passionate about providing the ideal individualized coverage for each customer. Each member of our team takes the time to truly understand your situation, the particular risks you anticipate – and the very real risks you’ve not yet contemplated. For all of your insurance needs, contact us at The Rubin Group!