If you have considered starting a business in Oklahoma, no matter what your field of expertise or experience, you no doubt understand that there is more involved than simply placing a sign in a window or finding a suitable location to open your doors.
You’ll want to decide on business structure and develop a marketing strategy that aligns with your goals. Whether you are a sole owner, have business partners or serve as an officer of a start-up corporation, the business structure will play into your decision. If you have employees, that will also impact your decision.
One thing is certain: You must abide by the requirements of appropriate federal, state and local jurisdictions before launching your business in Oklahoma. It can seem a bit overwhelming, so here is a guide to the basic steps you should take.
Do you need a business license in Oklahoma?
In general, a business license Oklahoma at the state level is only required for certain types of businesses in the Sooner State. Your business model will help you determine the licenses you must obtain:
- Sales Tax Permits: If your business sells goods or offers certain taxable services to the public, you will need to obtain a Sales Tax Permit from the Tax Commission. This permit enables your business to both collect and pay sales tax.
- Professional Licenses: Certain firms or organizations that offer advice or services to the public require professional training. Fields such as health care, hair and makeup services and various construction trades must obtain Oklahoma state-issued licenses. Obtain detailed information from the board that licenses your profession (for example the State Board of Cosmetology and Barbering or the Construction Industries Board). The state agency directory at oklahoma.gov lists them all.
- Food Permits are typically necessary for businesses that produce or manufacture edible products as well as for businesses that serve or sell food to the public. Check with the State Department of Health for specific information about the requirements.
Businesses that do not require licenses
Normally, the following types of businesses do not require a state license.
- Consulting services, including computer or information technology consultation and general business consulting.
- Bookkeeping services (other than CPA firms).
- Lawn care and cleaning or power-washing services.
However, the location of your business within the state may also play a role. Oklahoma’s counties and municipalities have broad authority to impose additional licensing and permitting rules within their jurisdictions. Special education or training may, in some cases, be necessary.
Always check with your local government authorities before launching your business in Oklahoma.
Some specific exceptions
An out-of-state retail business with no physical location in the state is required to register with the Oklahoma Tax Commission and collect sales tax once its Oklahoma sales exceed $100,000 a year.
Alcohol producers, importers and wholesalers need federal TTB permits, and anyone selling alcohol needs a state license from the ABLE Commission. Firearms, aviation and broadcasting businesses need federal licenses.
How much does a business license cost in Oklahoma?
Your business license cost varies not only state to state, but also county to county and industry to industry. Obtaining the state-issued Sales Tax Permit is easy and can be accomplished online. The fee is $20, plus $10 for each additional location, and permits are valid for three years. The permit, when issued, should be displayed at the business location. Visit the Oklahoma Taxpayer Access Portal to begin the process.
All startup businesses in Oklahoma should first apply for a Federal Employer Identification Number. There is no charge for this ID number. It is one of the first steps for anyone starting a new business in any locale. If you are a sole proprietor, you can submit your social security number in most cases.
You will also want to submit your banking information, and your company’s estimated sales figures.
Types of business licenses in Oklahoma and their cost
Without specific information about the type of business, its location and the company’s structure, it is difficult to determine startup costs or the fees required for licensing and permits. If no local permits or licenses are necessary, your beginning costs might be as low as the $20 sales tax permit fee.
Oklahoma seller’s permit
Oklahoma’s seller’s permit is the same as the sales tax permit ($20). It also lets you buy inventory for resale without paying sales tax.
Food licenses and health-related permits
A food service establishment license from the State Department of Health costs $425 for plan review plus $425 for the initial license, then $335 a year to renew. Seasonal licenses are $250. Cosmetologists, tattoo artists, and food trucks, as examples, often must also be licensed by local jurisdictions.
For some professional licenses, course completion or additional training is required, and the charges for such education can vary greatly. In addition, some professions have lifetime certifications, while others require an annual permit or renewal fee.
Other necessary registrations in Oklahoma
Prior to registering with the Oklahoma Tax Commission or another state, county or municipal authority, you can view a number of Business Videos prepared by the State of Oklahoma. They should answer most questions you might have. Visit the Oklahoma Tax Commission site and click the “Business” category to view the variety of videos available.
In most cases, you will then be able to complete your applications for required permits and licenses and also remit any fees electronically.
How to register a new business in Oklahoma
Depending on the type of business structure you adopt, there are specific regulations and procedures you will want to know about and follow. If you operate from two or more separate locations, determine if each requires a separate license or fee.
Check with the Oklahoma Secretary of State if you intend to incorporate your business. Also ask about requirements for a sole proprietorship, partnership or LLC if one of those is your business model.
Register for unemployment insurance taxes at the Oklahoma Employment Security Commission.
Contact the county assessor’s office in the county where your business is located to report business personal property.
Check with county or city authorities to see if you must obtain inspections of your office or business location.
Stay compliant
Once you are certain that you have applied for and been issued any permits or licenses that are required for your business, there will no doubt be some reporting requirements. Whether you must file monthly, quarterly or annual reports, or are otherwise required to fill out forms or certificates, always submit any necessary documentation by the specified due date, or ask for an extension if necessary.
For taxing purposes, always file a zero return if you have no sales to report. Remember that late filings may result in an additional fee.
Keep your official business records updated with the proper state authorities, as needed. Report all changes to a legal business or trade name, structure, physical location or mailing address. Keep phone numbers, leadership personnel, ownership, and any new locations or services updated with the authorities.
Nearly all such reports can be completed online.
Finally, cancel any permits or licenses that are issued in your business name if they are no longer required.
Conclusion
Transacting business in Oklahoma is not difficult, but it is important that, as a business owner or professional, you stay aware of any changes to the law or new requirements enacted by state, county and local authorities.
Every business is different, in terms of name, structure, start-up costs, licensing and permits, and policies and procedures. The initial decisions anyone who anticipates starting a new business must make include the entity’s business name and structure (such as a sole proprietorship, partnership, or corporation), and, for many owners, understanding how to start an LLC in Oklahoma can help clarify whether that structure makes sense for their goals. These early choices also include the location of your office or retail establishment and the types of goods or services the business will offer.
Once those decisions have been made, however, there are legal requirements to consider, including the need for permits or licenses, and whether your business or its employees must have or acquire specific education or licenses granted by state or local authorities.
While there are few requirements in Oklahoma that apply across the board to every business, there are detailed and specific regulations that govern some business types. While operating a business within the state typically does not require a state-issued license, businesses that sell taxable goods or services must obtain and display a sales tax permit.
FAQ
Typically, the same rules apply to home-based businesses and those firms that sell only online as well as businesses with physical locations. What you sell, where you operate and whether you have employees determine which licenses and permits you need. Business structure usually doesn’t.
You will need to check with licensing authorities in each state, but normally, licensing is issued by the state where the business is based. In Oklahoma, for example, an out-of-state seller must register to collect Oklahoma sales tax once its sales into Oklahoma exceed $100,000 a year.
Most permits and licenses required by the state of Oklahoma take minimal time for approval. Many, like the sales tax permit, are processed quickly online.