Most businesses in Oregon are small businesses. As of 2023, small businesses make up 99.4% of all businesses in the state, which translates to nearly 400,000 small businesses. And many of them (though certainly not all) get their start with an Oregon business license.
Depending on where you start a small business in Oregon, you may need local licenses, professional qualifications, approval from federal agencies, and more. Here's what you need to know about obtaining licenses in the Beaver State.
Do I need a business license in Oregon?
Oregon does not require a business license at the state level. However, at the local level, many cities and counties in Oregon require a business license. Regulated occupations, such as food service and healthcare, and occupations that deal with regulated products, such as alcohol or firearms, also require additional industry-specific licenses.
Businesses are generally required to register through the Secretary of State's Registry of Businesses. (Sole proprietors do not need to register unless they choose an assumed business name, hire employees, or are in an industry that requires special licenses or permits to operate.)
Eli Krueger, an attorney at Northwest Corporate Law who works with entrepreneurs and small businesses, recommends starting with Oregon's Business Xpress site, which helps business owners navigate a variety of processes, including registering their business, writing a business plan, hiring employees, determining tax liabilities and special licensing requirements.
“It's a great central repository for a lot of business-related information, contacts, and sites to visit,” says Eli. “It's a great place to orient yourself.”
Oregon Business License Types
While not all businesses require licenses at the local, state, and federal levels, business owners should be aware of the procedures required at each level of government.
State Requirements and Resources
If you're starting or expanding a business in Oregon, the first step is typically to register with the Oregon Business Registry at the Secretary of State's office. This is not a general business license, but a state-level registration that establishes a business entity.
Local requirements and resources
Find out if the city or county where your business is located requires any local business licenses, permits, or zoning considerations. Check your city or county site (Oregon has a list of cities with contact information). If you don't see specific information about business licenses, call your city's information number.
For home-based businesses, these local requirements may include a home-based business permit to ensure you are operating within zoning regulations.
Special State and Federal Requirements
Some businesses require certain licenses or permits under both state and federal law. Consider things like sanitation permits for restaurants, liquor licenses for bars, and special licenses for business activities like medical, cosmetology, and contracting.
The U.S. Small Business Administration provides a list of federally regulated occupations and the entities that issue these licenses. Oregon maintains its own license directory at the state level.
When in doubt, seek advice from experts such as the Small Business Association, Chamber of Commerce, city officials, and attorneys.
How to Apply for a Business License in Oregon
- Determine your business structure
- Register your company
- Research local requirements
- Meet special state requirements
- Ensure local zoning compliance
- Obtaining Federal Licenses and Permits
- Registration and License Renewal
Although requirements vary depending on the type of business and jurisdictional laws, the general steps for applying for a business license in Oregon are as follows:
1. Determine your business structure
First, choose the right business structure. The main categories, of increasing complexity, are:
- Sole proprietorship. A sole proprietorship is a structure in which one individual owns the business and is legally responsible for everything related to the business, including debts, losses, and liabilities.
- partnership. When two or more parties share profits and liability for debts, the business is a partnership.
- Limited Liability Company (LLC). A limited liability company (LLC) has a more complicated legal structure than a sole proprietorship or partnership, but it does reduce personal liability.
- Co., Ltd. Corporations are complex structures and often require outside legal counsel to set up, but because they are separate legal entities, the owners are protected from the liabilities of the corporation and from legal actions against the corporation.
At this stage, you will also need to decide on a name for your business. You can check the Oregon business name search database to see if that name is available.
2. Register your company
Next, you'll register your business with the state (sole proprietors who don't employ employees and don't need a license or permit to operate can skip this step). The Secretary of State's office allows you to apply online, in person at the state capital, Salem, or by fax or mail. Online is the quickest way, but if you choose another method, forms are available on the Secretary of State's website. You'll be asked to enter some basic information, such as your business name, contact information, address, and number of employees.
If you have employees or your business is a partnership or corporation, these forms will ask you to enter your Employer Identification Number (EIN), which you can obtain from the Internal Revenue Service website.
Please note that this is a registration, not a business license. However, it is the first step for any business in Oregon. Starting January 1, 2024, most new businesses in Oregon will be required to report their ownership information to the Financial Crimes Enforcement Network within 90 days.
3. Research local requirements
If you live in a city, check your city's municipal website first. For example, the City of Portland operates its own licensing department. If you can't find a specific listing for business licenses or have any remaining questions, call and ask your local city hall's information number. Some counties also have licensing requirements.
“In most cases, local city officials are polite and happy to talk to anyone with a question,” Eli says. “Some of them have been there for 30 years, so if you can't find the answer after a few minutes of clicking through city websites, asking them for help can save you a lot of time. Even if they can't give you the exact answer you need, they can often point you to additional resources or contacts.”
4. Meeting special state requirements
Some professional occupations and business activities require a license, permit, or certification from a state government agency or a self-regulatory industry board. For example, contractors must be licensed by the Oregon Building Contractors Board.
If you're unsure of the requirements for your occupation, check your state's license directory tool, which allows you to filter results by industry category.
5. Ensure local zoning compliance
If you operate your business from a physical location, you'll need to make sure your activities comply with local zoning regulations. If you operate your business from home, you may need to obtain a special home-based business permit, especially if customers come to your home.
Again, many city and county sites have information about zoning regulations, and in some larger cities, you may need to contact a dedicated planning or zoning department.
6. Obtain federal licenses and permits
Business activities regulated by a U.S. federal agency require a federal license or permit. These include agriculture, transportation, alcohol, broadcasting, etc. The U.S. Small Business Administration provides a list of federally regulated occupations and the organizations that issue these licenses.
If you work in an industry that is not federally regulated, this procedure does not apply to you.
7. Registration and License Renewal
You'll need to renew your business registrations and licenses periodically. In Oregon, registrations for most types of businesses are renewed annually on the anniversary of the original filing. The state automatically sends you a renewal notice about 45 days in advance.
How much does it cost to get a business license in Oregon?
Oregon doesn't have a state business licensing requirement, but most businesses must register with the state. Registration fees vary but are relatively small. For example, an Oregon-based LLC pays $100 annually to register and renew.
Some business activities may require a local business license or specialized permit. Costs vary, but for many industries, it only costs a few hundred dollars, Kruger says.
Oregon Business License FAQs
Do I need a business license in Oregon?
Oregon does not offer state-level business licensing, but many companies operating in the state must register with the Oregon Secretary of State. At the local level, some cities and counties set their own licensing requirements. Certain regulated industries also require licenses, permits, or certifications from state and federal agencies.
Can I run a home-based business in Oregon?
Yes. Some cities may require you to obtain a telecommuting permit to comply with zoning laws, so check with your local planning or zoning department.
How do I start a business in Oregon?
Create a business plan, choose a business structure, register your business with the Oregon Secretary of State if necessary, obtain any necessary licenses from the city or county where you will operate if applicable, obtain any special industry licenses, permits or certificates from state or federal agencies if applicable, open a business bank account, understand your tax obligations, establish a physical or online presence, and market your business.
