Minnesota does not require a general business license. This means that many businesses operate without special permits or constraints. However, some businesses require a license if the business, profession or industry is more regulated.
A sales and use tax license is one of the most commonly required licenses in the state. This license is required by businesses selling taxable goods and services in the state. This license is issued by the Ministry of Revenue and is obtained by registering on the MN e-Services portal and completing the application.
Other types of licenses may be required to provide certain services such as medical, cosmetology or insurance services. These are regulated industries where the state seeks to protect consumers by requiring licensed persons to meet certain standards.
When do you need a business license in Minnesota?
If your business requires a business license, you will need to obtain it before engaging in business operations, including marketing.
As for a sales tax license, Minnesota requires it if you have a taxable presence in the state or if you are an out-of-state retailer doing business in the state. A taxable presence includes any business that:
- Has a physical location in the state
- Sells products to consumers in Minnesota
- Has 200 or more retail sales shipped to Minnesota in a 12 month period
- Owns property in Minnesota
- Has an inventory processing center in the state
- Has an employee, representative, agent or independent contractor working on behalf of the retailer in Minnesota
- Has retail sales of over $100,000 shipped to Minnesota in a 12 month period
Occupational licensing often requires hours of study and a test before a license can be granted, but varies from profession to profession.