Piles of paperwork: What to file for a new business
Depending on the type of business, the paperwork you’ll need can vary greatly. After all, a food truck won’t necessarily need to carry the same credentials as the local dentist's office. In certain jurisdictions and industries, some businesses need to obtain several licenses and permits to run smoothly and, of course, legally. Others may not require as many.
Knowing what information is necessary, applying for the correct documentation, and keeping records up-to-date are essential steps to your business’s overall success. Start by learning about some basic documents that many businesses carry and decide which might apply to your business. Then begin setting a solid foundation for your own endeavor with the forms and paperwork you need.
Creating a detailed business plan is essential to the success of any business. It serves as a roadmap for where you’d like your business to go. No matter where you’re starting out, a business plan can help you see your path forward.
A solid business plan should include information about your business goals, marketing strategies, financial projections, and operational plans. It can also be helpful if you decide to seek funding from investors or lenders.
A business plan is a written document that outlines your goals and objectives. It’s critical to have a well-thought-out business plan in place before launching your business. This is a way to guide you in the early stages of the business and as you plan for the future.
But how do you write a business plan? The key to writing a successful business plan is to focus on the details. This includes researching your target market and industry, outlining your current and future goals, and creating a financial plan. Here are some tips for writing a great business plan:
Define your goals
Before you start writing your business plan, take the time to define your goals. What do you want to achieve? Your goals should be measurable so that you can track them.
Research your market
Before you can outline your strategies, you must better understand your target market. Research the industry and find out what your competitors are doing. This will help you to create more effective strategies.
Create a financial plan
Creating a financial plan is essential for any business. You need to outline your expenses, income, and profits. Make sure you are realistic and include all your costs and potential risks.
Outline your strategies
Once you have defined your goals, researched the market, and created a financial plan, it’s time to create strategies for achieving your goals. This includes outlining marketing strategies, product development plans, and sales strategies.
Write the plan
Once you have outlined your strategies, it’s time to put them into writing. Make sure you clearly explain your objectives and strategies. This will strengthen your plan if you need to share it with others or reference it.
You can create a successful plan with proper research and planning to help you achieve your goals. Take the time to do your research and outline your strategies.
Business licenses and permits
A business license is a document that shows that you have met all the requirements of a particular jurisdiction to legally operate a business. For example, you may need a permit to operate a restaurant in certain cities or to run a business in certain industries. Many types of business activities can require permits and licenses:
- Alcohol sales
- Food handling
- Product sales
- Health and safety services
- Professional services like accounting and legal consulting
- Child care
Local or state government agencies typically issue business permits. They are often required by law and can be obtained by completing an application and paying a fee. Typically, they must be renewed annually.
Operating your business legally can save you a lot of headaches later, including avoiding fines and penalties. Depending on your jurisdiction, having a license or permit may qualify you for certain tax benefits.
One of the most important steps is getting the correct business license. You may need to apply for multiple business licenses depending on the industry of your business. Check with the authorities in your area or a professional to be sure you’ve applied for all the applicable permits. You can also make use of tools like ComplYant, which does the research for you to help you find and stay up to date with the deadlines of the licenses and taxes that apply to your business.
State Business License
Most states require businesses to obtain a general business license, which the Department of Revenue usually issues. This license allows you to conduct business activities in the state and may include an annual fee.
Local Business License
Depending on the type and size of your business, you may need a local business license issued by your city or county. This license is typically required for businesses that operate within a specific city or county and may have special requirements depending on the type of business you’re running.
Specialty Business License
Some businesses may need to obtain a specialty business license issued by the state or local government. Specialty licenses may be required for companies that provide certain professional services, such as accounting, legal, or medical services.
Federal Business License
Certain businesses may need a federal business license, which the federal government issues. This type of license is typically required for interstate commerce businesses, such as those that involve selling certain products or services to customers in other states.
| Operating your business legally can save you a lot of headaches- like dealing with fines and penalties. As a bonus, staying compliant by maintaining the proper licenses and permits may even qualify you for certain tax benefits.
Apply for a business license or permit
The process of obtaining a business license can vary from jurisdiction to jurisdiction. However, there are some general steps that business owners can follow:
- Gather the necessary information. Usually, the application will require you to provide information about your business, such as the type of business, the address, contact information, and the names of individuals authorized to make decisions on behalf of the business. You may also need to provide financial information, such as a business plan and projected income.
- Apply. Complete an application, typically available online or in person.
- Wait for approval. Once the application is submitted, you may need to wait for a response from the licensing agency. This can take anywhere from a few days to several weeks, depending on the jurisdiction and the complexity of the application. Once your application is approved, the agency will issue a business license.
- Remember to renew. In some cases, the license may need to be renewed annually or biannually.
- Complete any next steps. It’s important to remember that applying for a business license is only the first step in setting up your business. Depending on the type of business you’re operating, you may need to register with other agencies, such as the IRS and the state’s labor department. You may also need to obtain additional permits or licenses in order to operate legally in your location.
If you’re unsure about the process for obtaining a business license, it’s best to consult with a professional to follow all applicable laws and regulations. Understanding the process can save you time, money, and potential legal trouble.
Depending on the type of business you’re setting up, you may need to fill out registration forms to officially register your business with the relevant authorities. This could include registering your business name and your domain name. Next, you'll need to register your business with the state. This will involve filing the necessary paperwork to set up your business as a corporation, partnership, limited liability company, or sole proprietorship. Depending on your business structure, you may need to complete additional filings with the Internal Revenue Service (IRS).
Employer Identification Number (EIN)
An EIN is a unique number that is used to identify your business for tax purposes. Depending upon your circumstances, such as if you’re starting a business that will have employees, you’ll want to register for an EIN. This number is used to identify the business for tax purposes and is required for businesses that file certain tax forms.
Other important initial paperwork
Getting that new business off on the right foot does require a lot of paperwork, but sometimes, only you can determine what is necessary for your business and the right timing. Just because you don’t need a specific permit on the first day of your business, it doesn’t mean that you won’t need it when you expand your operations two years later. It’s essential to keep yourself up-to-date with what may be required to keep your business compliant with the local jurisdiction.
Depending on the type of business you’re starting, you may need to purchase insurance to protect your business from potential risks. This could include general liability insurance, workers’ compensation insurance, or professional liability insurance.
If you’re starting a corporation or limited liability company (LLC), you must create bylaws. Bylaws are internal rules and regulations that govern how the business will be operated and will serve as the primary source of information for any legal and financial decisions made by the business. It is also important for protecting the business's and its owners' assets.
When running a business, you’ll need to enter into various contracts with vendors, customers, and other business partners. You may also need contracts for employees or contractors. You could also outline documents to protect your intellectual property, such as non-disclosure agreements (NDA) and trademark agreements.
Be sure that contracts clearly outline the rights and responsibilities of each party. In all cases, they should be reviewed and updated regularly. Consider consulting professional legal services to help draft these documents and ensure all contracts and agreements are enforceable.
Bank account and financial documentation
You’ll need to open a business bank account to keep your business finances separate from your personal finances. This will make tracking your business expenses and income easier and may provide greater financial protection in the event of a lawsuit.
Get your paperwork, and your deadlines, in order
Paperwork is time-consuming, and it can be overwhelming. With many different applications to complete and different legal requirements, starting a business can feel like a lot of homework. Fortunately, there is help. You can consult the local commerce organizations in your area to help you break down what you may need to keep your business running legally. Signing up for a free account on ComplYant can also provide automatic reminders for licenses and taxes that affect your business; you don’t have to do the research or remember a deadline.
Whatever system works best for you, start your business on the right foot, and then take the next steps forward by keeping all your licenses and permits up to date.