Business licenses are of many types. But common business licenses are:

• General business license 
• Sales tax license 
• Home-based permit 
  

What Is A Business License?

A business license is a golden ticket from the government that says, "Hey, you're good to go, do your thing!" It's permission to operate your business legally. Now, there isn't just one-size-fits-all; there are different types depending on what you're up to.

First off, you've got the general business license. This is like the all-encompassing pass that lets you operate your company in a specific area. It's like the foundation for every business, online or offline. 

Then there's the sales tax license, also known as a seller's permit. This one is crucial if you're selling stuff that can be taxed. You collect and send in those sales taxes, making sure you're all square with the law.

For online businesses, it gets a bit trickier. If you're selling to different places, you might need multiple versions of the same license. And if you're chilling at home while running your online gig, some places want you to have a home occupation permit. It's like giving your home office the official thumbs up.

Now, depending on what you're doing, there are specialized licenses too. Pros like doctors or architects might need a professional or occupational license. And if you're dealing with special goods like alcohol or firearms, there are specific licenses for those.

Do You Need a Business License To Sell Online?

Yes, you need a business license to sell online. So the deal with business licenses for online ventures is pretty straightforward. 

In a nutshell, most small businesses, whether operating online or not, need a mix of licenses and permits from federal and state government agencies. 

Now, the specifics can vary based on where you're located, the nature of your business, and the rules laid down by the government.

The necessity for a business license isn't a one-size-fits-all situation. Some places demand it right from your very first sale, while others give you a bit of leeway until your sales hit a particular threshold. It's a bit of a jurisdictional dance, you could say.

Your business location plays a significant role in this licensing tango. Different states, counties, and cities have their own set of regulations. Plus, if you're selling internationally, buckle up for some additional complexity, as each country might have its licensing requirements.

Now, the products you're selling also come into play. If you're dealing with special items like alcohol, firearms, pharmaceuticals, or even offering professional services, there might be additional licensing requirements to ensure safety, compliance, and consumer protection.

And here's the legal lowdown – operating online doesn't exempt you from needing a business license. It's a formal nod from the authorities that you're doing things by the book. From federal to state and even local levels, you might need different licenses based on what you're selling and where you're selling it.

So, yes, it's a bit of a puzzle, but ensuring you have the right licenses is crucial to avoiding legal hassles down the road.

Types of Business Licence

Firstly, there's the General Business License, kind of like the baseline permission for operating any business in a specific area. Whether issued by the state, county, or city, it acts as a broad license covering all kinds of businesses, online or offline.

Then, we have the Sales Tax License, a crucial one if you're selling goods. It allows you to collect and remit sales taxes, usually to the state, but with some places taking on additional local taxes. It's vital to collect sales tax based on the location where the product or service is delivered.

However, marketplaces like Amazon and Etsy don’t require business licenses. They will acquire this on your behalf.

For those hustling from home, the Home-Based Permit comes into play. This permit is essential in some jurisdictions to ensure your home-based business follows specific regulations, especially if you're shipping products or hiring employees from your residence.

Next up, we delve into more specialized licenses. If you're in a professional field like law or medicine, you might need a Professional/Occupational License, which is specific to certain industries, ensuring you're legally offering specialized services.

Specialized Licenses kick in when dealing with unique products or services like alcohol, firearms, or pharmaceuticals. These licenses come with industry-specific regulations, fees, and inspections, often governed by both federal and local authorities.

The Seller’s Permit or Vendor’s License is a crucial document for businesses selling products subject to taxation. It not only allows you to collect sales tax but also may enable you to purchase certain items for your business without paying sales tax through a resale certificate.

Furthermore, there's the Sales Tax License, which is essential for charging and remitting sales tax. For a more formal touch, the Employer Identification Number (EIN) functions like a business's Social Security number, crucial for identification and necessary for incorporating as an entity other than a sole proprietorship.

Lastly, if you're operating under a business name different from your own, the "Doing Business As" (DBA) registration is key. It gives you the green light to operate under a trade name.

Determining Which Type Of License You Need For Online Sales

Figuring out which license you need for selling online boils down to a couple of key steps. First off, dive into some research. Check-in with your local government, city or county offices, or the relevant licensing agency to pinpoint the specific license requirements for your business. This is crucial because different industries and locations may have different rules.

Now, let's talk about your city and state—they're the VIPs in determining what licenses you need to rock the online sales game. These licenses might vary, and some places might throw in extra permits not covered in a general guide.

The types of products you're selling also play a role. If you're in the fireworks business, that's a different ball game compared to selling jewelry. And if your gig falls under federal regulations—think firearms, alcohol, or agriculture—then federal licenses might come into play.

Here's a pro tip: a business attorney can be your guide through this licensing maze. They can help you navigate state and city regulations, ensuring you've got the right licenses in place. Don't forget to check out your local Small Business Development Center—they're often wizards at untangling licensing knots.

So, it's a bit of detective work mixed with a dash of local insights to determine the perfect license for your online sales venture. 

Application & Process of Getting Business Licence

Getting your business license is like jumping through a few hoops, but don't worry, it's manageable. Here's a simplified rundown of the process:

First things first, determine the license you need by doing some research. Check with your local government, city, or county offices to understand the specific requirements for your industry and location.

Next up, gather the required info and documents for your application. This might include your business name, contact details, business structure, tax ID, proof of address, identification documents, and any industry-specific certifications or permits.

Now, get ready for the paperwork. Obtain the official application form from the relevant licensing authority. You can either grab it from their office or download it from their website. Fill it out accurately, making sure you've covered all sections and attached any necessary documents.

Once your application is looking sharp, submit it along with any required fees. Some places accept online applications, while others might need you to mail it in or show up in person. Pay attention to the submission process and ensure you've covered any application fees.

Now, the waiting game begins. Keep tabs on the status of your application and any communication from the licensing authority. They might request additional info or even schedule an inspection. Once they give the nod, you'll officially get your business license.

Remember, if you're applying for an online business license, the process might slightly vary depending on your city or state. Some may allow online applications, while others prefer the traditional mail or in-person route.

Lastly, don't forget to mark your calendar with the expiration date of your license. It's a detail that can slip through the cracks but is crucial to keeping your business in good standing.

And that's it – you've navigated the maze of getting your business license! If you ever feel stuck, reaching out to resources like the Small Business Administration or a business attorney can be a wise move. 

If you’re looking for a platform to sell your digital products online, Crowdfundly is a great option. 

What is Crowdfundly?

Crowdfundly is a tool exclusively for creators to receive donations, recur support via memberships, and sell anything to the fans. 

With Crowdfundly, you can build your digital shop and sell your artwork there. You can also sell AI-generated art on Crowdfundly. 

Here are the steps to sell art on Crowdfundly-

• Create an account and set the payment getaway from the settings
• Go to ‘Shop’ in the sidebar and then choose ‘Digital Art’.
• Fill up the required details and set the pricing of your artwork.
• Choose ‘create’ and voila you will have your shop in 3 easy steps. 

To get the link, go to ‘View My Page’ from the menu bar on the topmost right corner, go to ‘Shop’, and click on the art you want to share. Copy the link and share it on your Instagram bio. 

FAQs

How Much Does A Business License Cost? 

There is no cost of getting required licenses or permits to make a digital product business compliant. In many cases, you even don’t have to pay anything. The cost depends on what state you live in, what type of license you’re getting, and how many types of licenses you require. 

What Are The Best Platforms To Sell Digital Products Online? 

There are many platforms where you can sell digital products. Gumroad, Sellfy, Teachable, Payhip, Podia, Sellwire, and FlickRocket. There are also marketplaces like Amazon, Shopify, and Woocommerce. It depends on your requirements to choose the best platform according to your requirements. 

What Are The Best-Selling Digital Products?

You can sell a wide range of digital products like ebooks, audio files, music, artwork, designs, and so on online. Choose what you do best and start leveraging on your enterprise and monetize it online. 

Concluding words

Now that you know what kind of business license you will require to sell online, get the required licenses and start selling online.