Business Licences: Navigating Legal Requirements for Startups
A business licence provides permission for certain types of business activities. They are typically granted by Local Authorities or specific Government bodies. They aim to regulate and safeguard your business to ensure you follow adequate procedures.
It is usually those businesses with specialised business activities that require a licence. For example:
Selling alcohol requires a personal and premises licence from your local licensing authority, which you can find here.
Financial activities, such as lending money, are regulated by the Financial Conduct Authority (FCA).
To play recorded music in public, including a shop, you must apply to the UK's music licensing company PPL PRS.
The DVLA issues licences to drivers, they also regulate drivers or instructors that provide training.
To process the personal data of your customers, you need a licence from the Information Commissioner's Office.
Other businesses requiring a licence will include, but are not limited to:
Child care
Pubs/Bars/Restaurant selling alcohol
Dog breeding
Ear piercing
Gambling services
Pet shop
Security guard
Sports coach
Taxi driver
Purposes of Licencing
Obtaining the appropriate license is critical for the protection of a business and its customers. Not only does a business comply with the law (by obtaining a licence before carrying out certain activities) but it also abides by the intended set of health and safety standards and protocols established by the licence.
Furthermore, by obtaining a licence, a business will also become accountable for its business activities, placing the burden to comply with relevant health and safety regulations (and other requirements) on the business. Failure to do so can result in the license being revoked. It is also possible in some circumstances for legal remedies to be pursued against the business itself.
Applying for a Licence
Applications for business licences must be sent to the relevant Local Authority. As long as the eligibility and other requirements are met, a personal licence can be valid for 10 years and can be easily renewed each time for an additional 10-year period. Most licences must be renewed on a regular basis, and additional payments must be paid for maintenance and renewal.
The cost of a business licence will vary depending on the type of business activities it relates to. Other factors may also have an impact. For example, in England and Wales, premise licences for alcohol are subject to an application fee based on the rateable value of the business premises. Gov.uk states that the application fees for premise licences range from £100 to £1,905, depending on the fee band of the venue. Individual Local Authorities set the price for the licences they provide, which varies by location.
Consequences for trading without a licence
Before you can start doing business in any of the aforementioned industries, you must have the appropriate licence in place. Trading without a licence can have very serious consequences, such as having your business shut down, having costs assessed, and in certain cases, being found guilty of a crime.
To check if your business requires a licence, click here.
For a more in-depth explanation of business licences click here.
Authors: Tanisha Shah, Rita Almazuri and Sofia Martiello -
Authors: Tanisha Shah, Rita Almazuri and Sofia Martiello -
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DISCLAIMER
This article has been written by law students for the sole purpose of providing informative insight. The information in this article is intended for educational purposes only and does not constitute legal advice, nor should the information be used for the purpose of advising clients. You should seek independent legal advice before relying on any of the information provided in this article.
Sources
Sam Bromley, 'Do I need a business licence in the UK?' (Simply Business, 26 October 2021) <https://www.simplybusiness.co.uk/knowledge/articles/2021/10/business-licence-uk-do-i-need-one/> accessed 26 January 2023
AXA, 'What business licences do I need?' (AXA) <https://www.axa.co.uk/business-insurance/business-guardian-angel/a-guide-to-business-licences/> accessed 26 January 2023
Rimay Villaester, 'Business licence UK: Who needs one and how to apply' (WISE, 26 April 2021) <https://wise.com/gb/blog/business-licence> accessed 26 January 2023
Michelle, 'Does My Business Need a Licence?' (Your Company Formations, 18 July 2018) <https://www.yourcompanyformations.co.uk/blog/does-my-business-need-a-licence/> accessed 26 January 2023
