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Getting your business up and running in Vermont takes more than just a good business idea. A key element new businesses sometimes miss is getting the right licenses and permits in place. The exact requirements for a Vermont business license can differ depending on state laws, business type and company structure.
To help make sorting through the requirements easier, we’ve broken down the steps you’ll need to follow. This guide brings together research into Vermont laws, local ordinances and federal rules so you can get started with confidence.
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1. Legally Form Your Business
Before you get a business license in Vermont, you should first set up a licensable entity in the state. Your business structure, such as a corporation or limited partnership, is a determining factor in the process. For example, not all businesses are legally mandated to obtain an EIN, or employer identification number, from the IRS (though requesting an EIN can be helpful for virtually any business). If you decide to set up an LLC in Vermont, you are required to register with the state.
The fee to file a business with the Vermont Secretary of State’s Business Services Division varies by business type (e.g., $155 for an LLC, $130 for a limited partnership) and comes with legal and tax benefits.
If you want to create an LLC, working with one of the best LLC services in Vermont is one way you can ensure you’ve completed all the proper forms and satisfied all the criteria.
2. Determine Which Licenses You Need
There are various levels of licensing authorities for businesses within Vermont, including state, local and federal bodies. Which licenses your business needs and at which tier depends on elements such as the nature of the business, its location and local laws and ordinances.
State Licenses
Vermont does not require businesses to obtain a state-level business license. However, any business operating within the state may be governed by other licensure criteria, covered below.
Sales and Use Tax Permit
The legal sale of most goods and services in Vermont, whether occurring at a physical storefront or via e-commerce, may necessitate issuance of a sales and use tax permit by the Agency of Administration and Department of Taxes. This permit lets the state collect tax on such sales.
A business may require this type of permit in more than one state. A Supreme Court opinion from 2018 known as the Wayfair decision paved the way for states to collect taxes on online sales by any business to their residents when the business has enough economic ties to the state (often determined by a minimum threshold of sales in a certain amount of time).
If you’re conducting business via the internet, it might be in your best interest to talk to a lawyer or qualified tax advisor to make sure you fully understand how to keep your business in compliance.
Professional Licenses
Some businesses in Vermont require more than just a standard business license. If your business requires specialized training, public safety or regulated expertise—such as in health care or finance—you may need to meet additional requirements.
Anyone engaging in business requiring a professional license must meet certain licensing standards set by a state board or regulatory agency. This often includes passing a state or national exam, paying fees and undergoing a background check. For instance, candidates for licensure to actively practice law in Vermont must pay a $420 fee. Maintaining your license may require renewal fees or continuing education.
Examples of professions that require professional licensure in Vermont, along with the licensing entity, include:
City, Town or County Licenses
Some cities or counties within Vermont have additional business licensing rules. This means that your business may need to register with the local government. For instance, Burlington requires a peddler’s license for vending in public.
Local regulations can vary, so reach out to your city or county clerk’s office if you are unsure whether your business needs a local license or permit.
Federal Licenses
If your business operates in a sector subject to regulation by the federal government, you’re legally required to hold federal licensure for such activities. These areas include alcohol sales and commercial fisheries.
The U.S. Small Business Administration maintains a list of industries for which federal licensure is mandated and provides information on associated requirements for each, such as the payment of a fee.
3. Gather Required Documents
Business license applications in Vermont typically require supporting documentation. This documentation is intended to show that your business is legally and financially prepared to operate, such as obtaining an EIN for your LLC. Here are some of the most commonly required items:
- Business entity certificate (evidencing creation of your LLC, corporation, etc.)
- Proof of insurance coverage
- Employer identification number or Social Security number
- Proof of professional licensure (if applicable)
- Recent bank statements
- Zoning approval (for physical business locations)
A complete list of required documents can be found on your business license application instructions.
4. Apply for Licenses and Permits
If you’ve gathered the proper documents and all the necessary information, you’re ready to petition for licenses and permits for your Vermont business. The possible methods for applying (e.g., in person, over the phone or online) vary contingent on the issuing entity.
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5. Maintain Compliance
Securing your business license is enough to get started, but every license comes with ongoing compliance requirements. Staying on top of your obligations can ensure your license stays active and will help you avoid penalties or suspension.
Follow these suggestions to stay compliant.
- Check your license expiration dates and pay any renewal fees on time. For example, accountants in Vermont must renew their licensure biennially for a fee of $255.
- Keep your contact details and business information current with the issuing state entities.
- Submit necessary filings such as annual reports or financial disclosures as mandated.
- Attend any continuing education course requirements. Report and/or certify course completions through the licensing agency’s reporting system.
- Stay informed about state, federal or local regulatory updates that may impact your business.
- Respond promptly to any notices of breaches or other compliance issues.
Frequently Asked Questions (FAQs)
What is the most difficult step in the process of getting a business license?
The most difficult step is often determining exactly which licenses or permits your business needs. Licensing regulations can vary widely by industry, business structure and operating location.
Do you need a special business license for selling goods online to residents of other states?
You don’t need a special license specifically for selling goods online, but if you’re conducting e-commerce across state lines, you might require a sales tax permit from any state with which your business has a significant economic connection. If you’re unsure whether this is relevant to you, it would be smart to consult with a lawyer or qualified tax professional.
Is a business license the same as an LLC?
An LLC is one kind of enterprise that could need some forms of licensure to conduct business in compliance with local, state and federal regulations. A business license is official permission from some level of government to operate within a certain area for a particular period of time.