Are you thinking of starting a business in Texas and aren’t quite sure where to start?
Or you already have a few years under your belt, but you just realized you need a Texas business license?
That’s where we come in to help.
Getting licensed can feel complicated, precisely because your business type influences your licensing and permit requirements. So if you specialize in multiple types of work, there’s a chance that you’ll need to apply for more than one business license.
Frustrating? Absolutely. That’s why we’ve mapped out what to do, including a step-by-step guide to filling out your license application.
Let’s do this!
There’s no statewide license requirement. However, Texas does require certain business types to apply for specific licenses and permits, so depending on the type of work you perform, you may need to complete a few different applications.
Rather than a general license, Texas requires most businesses to obtain a Sales Use and Tax Permit. This Tax Permit is typically required if you're based in Texas and:
The same rules apply if you’re a remote business but you sell products or services in the Lone Star State.
This article will focus on business owners located IN Texas, but check out this FAQ page if you have more questions about the state’s stance on remote selling.
One quick note before we continue — applying for a permit or business license can feel like you’re fumbling through a pile of paperwork. So it’s understandable if you’ve been putting it off, or you think you don’t really need to get one right now.
But don’t fall into that trap. If Texas requires you to carry a certain license or permit, you absolutely should have it for the following reasons:
Now let’s focus on what you came here for: how to apply.
Head to the Texas Comptroller website and click on “Apply for Permit via eSystems.”
Keep in mind that you’ll need to be at least 18 or older and have a Social Security number. If you run a partnership, you’ll also need the Social Security number of any partners within your business.
There’s typically no fee to complete this application (awesome!) and, if approved, you should expect to get your permit within two to three business weeks.
Here’s where applying can get a little complicated. While you likely won’t be required to get a state-based license, you may still need to get licensed depending on the services you provide or the products you sell.
Fortunately, Texas makes it fairly easy to locate your business type and determine which websites you need to visit to get licensed. Download the 2020 Texas Business Licenses and Permits guide and scroll through the PDF to find your industry. From there, you should see a link to the Texas website where you can apply for any relevant licenses and permits.
This PDF is updated every February, so makes sure you get the most recent one.
Not seeing your business listed anywhere within the guide?
If that’s the case, it’s recommended that you call the Comptroller of Public Accounts with your questions. You can call them at 512-463-4600 or visit their website for more help.
If you are required to take out a license or permit, don’t be surprised if you’re required to show proof of business insurance.
Here’s why: business insurance shows that you’re protecting your customers, vendors, and employees from accidents, third-party property damage, and more. Plus, some types of business insurance (like workers compensation) are required if you have any part-time or full-time employees.
If you’re asked to show proof of insurance in order to get licensed, we can help there too. Just use our free quote comparison tool to find policy options from insurers who provide Texas-based insurance policies.
Simply choose the policy you need, click to buy, and boom — you’re all set to apply for whichever license you’re required to have.
Fortunately, it’s free of charge to apply for your Texas Sales Use and Tax Permit. However, you may need to post a security bond, depending on the type of business you run.
For more questions about any additional costs for a Texas business license, check out the Comptroller's website here.
A license is more than just another box you need to check to get up and running.
It’s the key to setting the foundations for a successful business.
After all, having a licensed business means your customers can feel more confident about working with you. Plus, it means you likely won’t run into any legal problems that may stem from owning and operating an unlicensed operation.
So even though the application may feel like a pain, don’t give up — it’s worth the hassle!
*Monthly payment calculations (i) do not include initial premium down payment and (ii) may vary by state, insurance provider, and nature of your business. Averages based on January - March 2023 data of 10% of our total policies sold.
I love writing about the small business experience because I happen to be a small business owner - I've had a freelance copywriting business for over 10 years. In addition to that, I also head up the content strategy here at Simply Business. Reach out if you have a great idea for an article or just want to say hi!
Mariah writes on a number of topics such as small business planning, contractor insurance, and business licenses.
This content is for general, informational purposes only and is not intended to provide legal, tax, accounting, or financial advice. Please obtain expert advice from industry specific professionals who may better understand your business’s needs. Read our full disclaimer
*Harborway Insurance policies are underwritten by Spinnaker Insurance Company and reinsured by Munich Re, an A+ (Superior) rated insurance carrier by AM Best. Harborway Insurance is a brand name of Harborway Insurance Agency, LLC, a licensed insurance producer in all 50 states and the District of Columbia. California license #6004217.