What is a Business Licence?

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What is a Business Licence?

Business licences can be confusing: what are they? What do they mean? Do you need a business licence? 

We've pulled together a pretty handy guide about what a business licence is so you can discern if you need one to run your company. 

Read on for some more info: 

Do I Need a Business Licence?

Certain business types need a licence or permit to operate or permission for your business premises to be used for certain activities.

Not every business in the UK requires a licence, but it is important that you clarify if you need one for your business before you start trading. If you don't you could face business disruption, penalties or even legal action further down the line.

The requirement to have a licence (or not) is separate from the legislation that requires you to have properly structured your business and registered with HMRC so whatever happens, you need to make sure that you get this sorted. 

What Types of Business Licence Are There? 

There is a wide range of business types that require a licence; the most obvious would be the licence to sell alcohol but there are many different businesses that need a licence based either on the product or service they provide.

These include taxi companies, food outlets, hotels, pet shops, hairdressers, firearms dealers and hotels.

Wondering about one-off licences? 

Some individual activities may also require one-off licences, for example for street parties or other public events.

Childcare and nursery businesses must also be licenced. For these types of licence, you must apply to the government department, whereas usually for a licence the first port of call would be your local authority.

Another type of licence business owners often overlook is a licence to play recorded music in public, for example, in a shop or bar. The process to obtain one of these is also a little different, instead of applying to your local authority, these licences are issued by the PPL or PRS.

If you’re carrying out certain financial activities, such as lending money or recovering debts, you’ll need to seek a licence from the Financial Conduct Authority. 

To get more information about which specific business licences you'll need, you can take a look at the UK Government website provides. Their handy tool will help you understand the licencing requirements for your business. If you need specific advice for an alcohol licence you will find it here.

It's usually your local authority that deals with licencing, so they should be the first point of contact for your enquiry. However, some licences are issued but specific government departments, these include:

  • Ofsted in England
  • Care Inspectorate in Scotland
  • Care and Social Services Inspectorate in Wales
  • Department of Health, Social Services and Public Safety in Northern Ireland

There you have it: a brief overview of what business licences are all about, which businesses might need one. 

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