How Much Does a Business License Cost in Delaware

One crucial part of the entrepreneurial process is filing the correct paperwork with your state, county, and, in some cases, city. If you’re thinking of starting a business in Delaware, you must consider all the permits and licenses required before you can open your storefront, whether it’s digital or physical.

However, in addition to filling out the correct documents, you must also think about the cost of a Delaware business license. Startup fees add up quickly, so knowing these expenses beforehand can help you plan better financially and start your new venture on the right footing.

With that in mind, let’s break down the business license costs and what it takes to start a new company in the Diamond State.

Do you need a business license in Delaware?

Yes, all businesses operating in Delaware must obtain a general business license from the Delaware Division of Revenue. However, some businesses, such as professional services, must get additional licensing before they can take on clients.

One unique aspect of Delaware’s business licensing requirements is that the state doesn’t charge sales tax, so retailers don’t need a sales tax permit or seller’s permit. Instead, a general business license should be enough to sell products.

How much does a business license cost in Delaware?

Broadly speaking, most businesses in Delaware must pay a $75 license fee for a single location and another $25 for each additional location. That said, there are multiple business types that must pay a different amount, as listed in the Delaware code regarding Occupational and Business Licenses and Taxes. Some notable exceptions to the $75 cost include:

• Hotels and Motels – $25 per room, and hotels must pay $30 for each suite.
• Finance or Small Loan Agency – $450
• Outdoor Music Festival Promoter – $750
• Tax or Bus Operator – $45 for the first vehicle and $30 for each additional vehicle
• Travel Agency – $225

In addition to a general business license, certain counties and cities in Delaware have their own licensing requirements and fees. For example, in Wilmington, all businesses must obtain a license with the city, and the cost depends on the type of business. For example, construction companies must pay $120, while retailers must pay $151, and various professional services (like accountants) must pay $181.

Finally, Delaware requires businesses to renew their licenses annually. The fees are the same, so if you paid $75 for your original license, you’ll also pay $75 for the renewal. Delaware allows companies to pre-pay for up to three years, although the cost remains the same. However, one potential advantage of pre-paying is that you may be exempt from paying a higher price if the cost goes up during that period.

Types of business licenses in Delaware and their costs

Depending on where your business is located in Delaware, you may have to obtain different types of licenses. Here’s a quick overview of each:

City licenses

Various cities in Delaware require businesses to obtain licensure, and the costs can vary from one city to the next. For example, in Wilmington, the cost depends on the type of business you have. In Wyoming, however, the cost depends on the number of employees.

County licenses

Delaware only has three counties in the entire state: Kent, New Castle, and Sussex. Kent County only requires business licenses for dog-related companies, such as kennels, groomers, and pet shops. New Castle County requires licenses for dog-related businesses and contractors. Sussex County requires licensing for plumbers, Septage Program waste haulers, dog-related businesses, and contractors.

State licenses

All businesses must obtain a general business license to operate in Delaware. Typically, you’ll need this license first before you can file paperwork for city and county-level licenses. Also, keep in mind that you may have to register your business with different divisions, such as the Division of Corporations, the Division of Professional Regulations, the Division of Unemployment Insurance and the Office of Workers Compensation.

Federal licenses

Most businesses won’t need a federal business license to operate in Delaware. However, some notable exceptions include:

• Firearms – Must get a license from the Bureau of Alcohol, Tobacco, Firearms, and Explosives.
• Alcohol Sales, Import, and Manufacture – A license from the Alcohol and Tobacco Tax and Trade Bureau.
• Maritime Transportation – A license from the Federal Maritime Commission.
• Agriculture – A license from the U.S. Department of Agriculture.
• Aviation – A license from the Federal Aviation Commission.

In many cases, you must obtain your state-level license before getting a license from a federal agency.

For city and county-level licenses, the First Steps page on the Delaware.gov website provides links to each licensing page. Here, you can see which cities have business license requirements (e.g., Bethany Beach) and apply for them online.

For state-level license costs, refer to the Delaware Code Online website. It outlines which industries must pay a different amount from the usual $75.

For federal licensing, the Small Business Administration website can provide more details. Some federal licenses, like the Alcohol and Tobacco Tax and Trade Bureau Permit, don’t cost anything. Other licenses, like a Federal Firearms License, can cost up to $200.

Examples of different industries and the licenses they require

Generally, professional service businesses are required to obtain a license in addition to a general Delaware business license. Some common examples of professional services include:

• Accountants
• Architects
• Chiropractors
• Deadly Weapons Dealers
• Dentists
• HVAC
• Massage and Bodywork
• Nursing
• Plumbing
• Salons and Shops
• Veterinary Medicine

Each license has its own requirements and permitting costs. For example, for a CPA license, individuals must pay $187, while CPA firms must pay $226. Meanwhile, HVAC technicians must pay $173 for licensure.

If you’re trying to start a professional service business, you must familiarize yourself with the licensing requirements and fees. In many cases, you must pass a test or provide proof of hours worked within the field. Additionally, various businesses must also abide by different Delaware rules and regulations, so you should familiarize yourself with these guidelines as well before obtaining a license.

Renewing Your Business License in Delaware

All general business licenses expire on December 31st and must be renewed by that date. Professional licenses may have different expiration dates. For example, HVAC licenses expire on October 31st of even years.

To renew state business licenses, log into your One Stop Business Licensing Portal. For professional licenses, you must create an account with the Delaware Division of Professional Regulation (DELPROS). In either case, you can renew your license online and keep it in good standing.

Delaware charges a late penalty of 10 percent per month after the license expiration date, with a cap of 50 percent. If you do not renew your license after five months, you may risk closure of your business. If that happens, you must reapply for a new business license to keep your company in good standing.

For many professional licenses, the license expires as soon as the date passes. It is illegal to conduct professional business in Delaware with an expired license. Different permits have different late fees and penalties, so check with the Division of Professional Regulation website and your DELPROS account.

Get help starting your business in Delaware

Starting a business in Delaware doesn’t have to be a complicated and time-consuming ordeal. If you want to stay focused on running your business and working with your customers, you can get help with all the paperwork and other back-end details to ensure your company is compliant.

Let us assist you with licensing, permitting, and other bureaucratic details so you can focus on what’s most important to you. From filing documents to acting as a registered agent to forming an LLC in Delaware, we can handle it all.

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