Operating a business in Pennsylvania requires a business license, and federal, state, county, and local government agencies use the licensing process to ensure your activities comply with government regulations. Obtaining a license from the proper authority protects you from fines and potential closure. The cost to apply for and renew a business license varies depending on your type of business and the issuing agency.

Below, we’ll discuss common types of business licenses needed in Pennsylvania, the steps to apply, and licensing costs.

Key takeaways

• Pennsylvania has no state-level general business license. Instead, licensing requirements come from the agency that regulates your activity and from the municipality where your business operates.

• Most businesses that sell taxable goods or services need a sales tax license from the Pennsylvania Department of Revenue. That license is free and renews automatically every five years.

• The cost of getting a business license in Pennsylvania can vary significantly, depending on the type of license and the agency issuing it.

• Renewal cycles vary by license type and issuing agency, and so does whether you get a reminder. Operating on a lapsed or missing license can bring fines and other penalties.

What is a business license in Pennsylvania?

Pennsylvania doesn’t have a general business license. Instead, the licensing process and cost will depend on where and how your business operates. Depending on your type of business, you might be required to maintain a federal, state, county, or local business license or some combination of the four.

The state recommends that you review licensing requirements at each tier of government. For example, the county you operate in might not require a business license, but the city, township, or other municipality could have different rules. Some counties require a general business license for all entities, while others regulate only certain types of businesses.

What are the types of business licenses and permits in Pennsylvania?

There are several types of business licenses and permits in Pennsylvania. What you’ll need depends on the industry you operate in, where you’re located, and the taxes you assess. Here’s what is commonly required:

• County or local business license: The requirements for these are set by the county, city, borough, or township where you operate. Some municipalities require a license for every business, while others license only specific trades, and others might not require a license.

• Professional or occupational license: The state maintains 29 licensing boards and commissions to regulate a wide range of service professions. Some examples include accountants, cosmetologists, massage therapists, medical professionals, and vehicle dealers and salespeople. The Pennsylvania Bureau of Professional and Occupational Affairs maintains a list of regulated occupations.

• Sales, use, and hotel occupancy retail tax license: If your business collects sales tax for goods or services, you’re required to obtain this license through the Pennsylvania Department of Revenue.

• Industry-specific state licenses: If you operate in a state-regulated industry, you’ll likely need to obtain a license or permit. Examples include agriculture, addiction treatment providers, healthcare providers, insurance producers and agents, and alcohol-related businesses.

• Federal licenses for regulated industries: Businesses in certain industries typically must obtain a federal license to operate. This includes businesses related to agriculture, alcohol, aviation, drilling, broadcasting, firearms, transportation, commercial fishing, and nuclear energy.

How can you get a business license in Pennsylvania?

Follow this step-by-step guide to determine which business licenses or permits you need and how to get them:

1. Choose and register your business structure: Consult a tax professional or attorney to decide between a sole proprietorship, partnership, limited liability company (LLC), or corporation. Then register your business online through the Pennsylvania Business One-Stop Shop.

2. Get a federal Employer Identification Number (EIN): You can apply for an EIN online through the IRS. You’ll need to provide your business entity type, Social Security number or Taxpayer Identification Number (TIN), and business name.

3. Apply for a state-level license or permit through the relevant agency: If you’re operating in an industry or a profession that requires a state license or permit, submit an application with the applicable department. You can find a full list in the Business One-Stop Shop help center.

4. Obtain required county and local licenses: Search your county and local government’s websites or contact them to find out about licensing requirements and applications. You can find your county’s website through the County Commissioners Association of Pennsylvania, and you can search for local agencies through the Pennsylvania Business One-Stop Shop.

5. Register to collect and pay state taxes: Register your business with the Pennsylvania Department of Revenue through the myPATH portal. You’ll need to share your business name(s), EIN, address, and contact information as well as information about each owner, officer, or other responsible party, along with other details.

How much does a business license cost in Pennsylvania?

Costs depend on which licenses you need and where you operate. Pennsylvania charges nothing for a sales tax license, but professional license fees vary by trade. For example, initial licensure for a physician or surgeon starts at $35, and biennial renewal costs $360. Meanwhile, a cosmetologist will pay a $119 initial fee, followed by $97 for biennial license renewal.

Local license fees are set by each county and municipality. In Philadelphia, for instance, the Commercial Activity License is free and doesn’t need to be renewed. In Allentown, a business license costs $35 and must be renewed each calendar year. In Pittsburgh, where only certain businesses must be licensed, the annual cost can range from $50 to $135, depending on the license type.

How do you renew a Pennsylvania business license?

Renewal schedules depend on the type of license you hold. In many cases, state, county, and local licenses renew annually. Depending on the municipality, the renewal date might be based on a calendar year or a rolling 12-month basis.

Professional licenses typically renew every two years. However, if you hold a sales tax license, it renews automatically every five years as long as you don’t have any outstanding returns or tax liabilities.

Whether and how you’re notified about renewal deadlines depends on the type of business license you hold. For example, if you’re an accountant, you’ll receive a renewal notice at the most recent address provided to the board two or three months before it expires. If you’re a psychologist, you’ll get a notice in the mail 60 days before license expiration.

For county and local municipalities, contact your applicable agency to learn about notification policies. Sign up for renewal notifications so you don’t miss important deadlines.

What are some Pennsylvania-specific considerations and common mistakes?

Obtaining a business license in Pennsylvania isn’t always a straightforward process. Here are some considerations to note:

• Hyperlocal licensing: Pennsylvania has 67 counties and 2,555 municipalities, each with their own rules, applications, fees, and renewal processes. Depending on where your business operates, you’ll need to familiarize yourself with the licensing regulations of one or more counties, cities, boroughs, or townships.

• Advertising for fictitious names: If you plan to register and license a business under a fictitious name and have an individual listed on the registration, you must officially publish that intention in two newspapers generally circulated in the county where you’ll be operating. One of the newspapers must be a legal newspaper.

• Sales tax license for out-of-state businesses: If you primarily operate in a different state but generate at least $100,000 in annual gross sales in Pennsylvania, you must register, collect, and pay Pennsylvania state taxes.

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FAQs about how to get a business license in Pennsylvania