Thursday, November 5, 2015

Do You Need A Business License To Start A Website

Contrary to popular belief, the "e" in e-commerce does not stand for "except us." Simply starting a website does not require a license any more than any other hobby does. If you like to build websites and are not trying to earn a living from it, no license is necessary. If you build a website as a business or to support an existing business, you may need a license.


Government Regulation


Any offline business that requires a license still requires a license if performed through a website. You cannot bypass the state or federal licensing requirements just because your business doesn't have a physical office. Each state you do business in may require its own separate license. Check with your local laws and neighborhood covenants regarding regulations about running a business out of a home. Some areas limit or forbid it.


Regulated Services


Websites that offer regulated information, such as legal advice or medical diagnosis, require proper licensure of the owner or principals. An insurance company who only sells online still requires licensed insurance agents in the states they write policies. Consult with an attorney about licensing requirements before starting a website dedicated to professional advice. Federal laws regulating information disclosures still apply online. Real estate agents must fully disclose all of the terms of a quoted loan payment located on a Web page, just as if it were on an open house flier.


Internet Sales


Selling items over the internet may require a business license and a sales tax license depending on the state and city the business is in. Some states, like Colorado and North Carolina, require third-party sellers of drop shipping companies and affiliate sales programs to charge sales tax for all purchases. This applies even if you never touch the merchandise but only receive a commission for the sale when the purchaser enters the selling company's website through a link on your website. Many companies eliminated or restricted their affiliate sales programs in states with these laws.


Marketing Tool


Websites used as a marketing tool do not need a license. The profession may need a license, but a separate license isn't needed just to build a website any more than a professional needs a license to write a book on the subject. A bartender may need a license to tend bar, but doesn't need one when she starts a blog or website dedicated to the latest cocktails served in the club scene.

Tags: need license, affiliate sales, affiliate sales programs, build website, licensing requirements