How to Get a Small Business License in Arkansas

If you want to start a small business in Arkansas, then you'll need to follow the state's regulatory requirements. Apart from choosing a name and location for your business, you must obtain the necessary licenses and permits from your state and local governments.

Here are the basic license, permit, and registration requirements for an Arkansas business.

Which Business Licenses Do You Need for Your Small Business?

When starting a business in Arkansas, you must:

• register your business entity with the Arkansas Secretary of State (SOS)
• file taxes with the Arkansas Department of Finance and Administration (DFA), and
• apply for business licenses and permits with your state, county, and town.

The types of licenses and permits your business must apply for depends on your business structure, industry, and location. The main types of business licenses, permits, and registrations are:

• general business licenses
• professional licenses
• seller's permits (sometimes called "sales tax certificate")
• zoning and building permits, and
• doing business as (DBA) registrations.

(For more general guidance, see our article on the legal requirements for starting a small business.)

General Business License in Arkansas

As is the case with many states, businesses don't need to obtain a statewide general business license in Arkansas. However, you might need to obtain a general business license from the city or county where you plan to do business.

For example, the City of Little Rock requires anyone who operates a business in the city to obtain a business license (also called a "privilege license"). Depending on your type of business, you might need to obtain other licenses or permits from the city. For example, restaurants and catering services must also apply for the hotel and restaurant gross receipts tax. You can apply for the City of Little Rock business license online, in person, or by mail. You'll also need to pay an annual business tax to the city.

Some cities might require only some kinds of businesses to obtain a license. You should contact your local officials or visit your city's website for more information on what's required from your business. You should also check with your county for other licensing requirements.

Professional and Occupational Licenses for Businesses and Individuals in Arkansas

Many professions and occupations require special licensing and certification. For example, lawyers need to be licensed by the state bar, and doctors are licensed by the state medical board. Depending on your industry, you could be required to get a license for yourself and your business.

The Arkansas Department of Labor and Licensing (ADLL) is in charge of enforcing state labor laws—and by extension, licensing and regulating many professions and occupations. The ADLL oversees many boards and commissions, including accountants, contractors, real estate professionals, and more. You can find a full list of professions under the licensing section of the ADLL website.

Each occupation and profession has its own webpage with information, resources, and services available to practitioners. Through these webpages, you can learn about:

• the regulatory board and staff
• laws, rules, and standards for the profession
• how to apply for and renew a license
• board meetings and events
• examinations and continuing education
• frequently asked questions, and
• other topics and issues.

The ADLL, however, doesn't handle all professions. Specifically, legal, medical, and education professionals aren't included under the ADLL.

You should check with the board, commission, or agency that regulates your profession or occupation to see which licensing requirements apply to you. If your occupation or profession isn't listed with the ADLL, you can do an internet search for your board. For example, suppose you're in the nursing profession and you look up "Arkansas nurse license" on an internet search engine. You should quickly be directed to the Arkansas State Board of Nursing within the Arkansas Department of Health.

Arkansas Sales Tax Permit

If you operate as a vendor in Arkansas and provide goods and services that are subject to sales tax (also called "gross receipts tax"), then you must register your business with the DFA.

To collect and pay sales tax in Arkansas, you must complete an application for a sales tax permit. You can register your business and apply for the permit online through the Arkansas Taxpayer Access Point (ATAP). As of 2023, the sales tax permit fee is $50.

You should be prepared to provide the following information in your permit application:

• a signed copy of your commercial lease agreement for your business space
• a signed copy of a bill of sale if you purchased inventory or equipment from another business, and
• the date your business will begin operations in Arkansas.

To learn more, visit the sales and use tax section of the DFA website. The sales and use tax section contains important information, including:

• how to register for sales tax
• updates to sales tax laws
• answers to frequently asked questions
• city and county tax rates
• filing due dates, and
• information and resources on other relevant topics.

You should also check with your city or county to learn about their tax reporting requirements.

Local Zoning and Building Permits

In some instances, such as if you'll be constructing or renovating a space, you'll need to get special zoning and building permits. Typically, you'll need to complete an application and pay a fee. If your work is more substantial, you could need to submit your plans and go through additional reviews and inspections.

For instance, the City of North Little Rock requires permits based on the type of work to be performed. For example, if you want to build or remodel a space or put up a sign or banner, you'll need to obtain the proper permit from the city's planning department. The City of Little Rock's Planning Department has a list of applications, checklists, and other forms on its website that you can download.

If you're planning to do construction work in a historic district or a historic building, you'll probably need to follow more rules and requirements. You should check with your city's historical society or commission. Be prepared for tighter restrictions on the work you can do, longer review periods, and additional inspections.

Zoning laws. If your type of business isn't in line with the zoning code, you can find another space or potentially apply for a special use permit. A special permit can provide your business with an exception to the current use laws.

Building code. You can work with local departments and agencies to apply for building and construction permits. You'll likely need to have inspections related to your space's structural, electrical, mechanical, and plumbing features.

If you intend to lease a commercial space, make sure you have a section in the commercial lease that ensures the building and your use of the space are in line with the zoning laws.

If you plan to run your business out of your home, you could also need to apply for a special permit. For example, the City of Little Rock requires home-based business owners to fill out a Home Occupation Accessory Use Form along with their business license application. You'll need to make sure you follow special rules for home occupation. For example, you can't have employees reporting to your home for work and you can only have one service or company vehicle parked at your home at any time.

Registering a DBA in Arkansas

Choosing a name for your business is an important step in starting your company. Many sole proprietors and general partnerships choose a business name that doesn't include their own names. Instead, they use an alias. For example, Alex Mack, a sole proprietor, might sell hats under the name "Top of the Line Top Hats." In this case, Alex Mack is using an assumed name—also called a "fictitious name," a "trade name," or a "DBA."

Corporations, limited liability companies (LLCs), and other incorporated entities can also use assumed names. When a company uses a name that's different from the name the company has registered with the SOS in its formation documents (for example, its articles of incorporation or articles of organization), it's using an assumed name.

If you're using an assumed name, you must register the name. Sole proprietors and general partnerships must file an assumed name (or DBA) certificate with their county clerk in every county where they plan to do business. (Ark. Code § 4-70-203 (2023).)

Corporations, LLCs, and other incorporated business entities must first file an Application for Fictitious Name with the SOS. After you file your name with the SOS office, you must submit a copy to the county clerk in the county where your registered office is located. If your registered office is in Pulaski County, then you don't need to file with the county clerk.

The filing fee depends on your county and business structure. As of 2023, the filing fee typically ranges between $15 to $25.

For additional information, check the business services FAQ section of the SOS website.

Other Licenses and Permits Your Business Might Need

You might be required to comply with other laws and regulations in addition to the licenses and permits discussed above. For instance, your business might need to apply for special licensing or follow special rules related to:

• safety
• health, and
• the environment.

Sometimes these areas are encompassed within other licenses, permits, and registrations. Other times, these licenses and permits will require a separate process. If you're in a highly regulated field, you're more likely to need additional licenses and permits. For example, if you're running a plant that could potentially affect water streams or air quality, then you'll likely need to follow additional protocols.

These licenses and permits can be issued by the federal or state government, or locally. The requirements vary depending on the city or county involved. You should check the websites for the city and county where you'll operate your business for more information. Some businesses might be exempt from local licensing requirements under state or federal law.

You should check with your federal, state, and local governments for more information.

Government Resources for Small Businesses in Arkansas

The DFA publishes Starting a New Business in Arkansas: An Educational Brochure for Arkansas Taxpayers. The brochure provides information on various taxes applicable to Arkansas businesses. It also lists contact information for important state agencies. You can download a copy of the brochure from the DFA website.

The SOS also provides a guide to starting your own business. The guide includes information about:

• creating a business plan and financing your business
• registering your business
• business licenses and permits
• business insurance
• business taxes, and
• employment responsibilities.

The Arkansas Small Business and Technology Development Center (ASBTDC) has guidance on how to start and grow your business. The Center's website includes one-on-one confidential counseling and free market research. The ASBDTC also publishes a very helpful guide, License, Permit, & Tax Requirements for Arkansas Small Businesses. You can download a copy of the guide from the ASBTDC website. The ASBDTC is part of a national network of small business development centers.

The U.S. Small Business Administration (SBA) has a district office in Little Rock—the office's website lists upcoming events, resources, and news for small businesses.

Additional Help for Arkansas Small Businesses

You can also find more information on the small business section of our website. If you're looking to dive in further, you can also find expanded information in many Nolo books, such as Legal Guide for Starting & Running a Small Business, by Fred S. Steingold, and The Small Business Start-Up Kit, by Peri Pakroo.

If you're looking for personalized, professional help, consider talking to an Arkansas business lawyer. You should try, if possible, to find a lawyer who has experience assisting businesses in your industry. An attorney can help you navigate the steps to get your business license or permit.