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Do you need license to run Shopify store
Do you need license to run Shopify store
Do you need license to run Shopify store

Apr 18, 2025

Apr 18, 2025

Do You Need A License To Run A Shopify Store?

Do You Need A License To Run A Shopify Store?

One of the most common questions we get from our partners is:

Do you need a business license for Shopify?

The answer isn’t always straightforward…while Shopify itself doesn’t require you to have a license to open a store, your local laws, tax regulations, and the type of products you sell might.

If you’re planning to own a long-term, profitable online business, understanding when and why you might need a business license is crucial.

The last thing you want is to face legal issues, tax penalties, or payment processor restrictions down the road.

This guide will answer all your questions, including:

  • Do you need a business license to sell on Shopify?

  • Do you need an LLC to sell on Shopify?

  • Do you need a business license to dropship on Shopify?

  • And more!

Let’s break it all down for you so you can run your Shopify store legally and confidently…


One of the most common questions we get from our partners is:

Do you need a business license for Shopify?

The answer isn’t always straightforward…while Shopify itself doesn’t require you to have a license to open a store, your local laws, tax regulations, and the type of products you sell might.

If you’re planning to own a long-term, profitable online business, understanding when and why you might need a business license is crucial.

The last thing you want is to face legal issues, tax penalties, or payment processor restrictions down the road.

This guide will answer all your questions, including:

  • Do you need a business license to sell on Shopify?

  • Do you need an LLC to sell on Shopify?

  • Do you need a business license to dropship on Shopify?

  • And more!

Let’s break it all down for you so you can run your Shopify store legally and confidently…


Do You Need A Business License To Sell On Shopify?

Do You Need A Business License To Sell On Shopify

No, Shopify does not require you to have a business license to create and run a store. You just need to sign up, set up your shop, and you can start selling without showing Shopify any legal documentation.

However, this doesn’t mean you’re legally exempt from needing a license. Whether you must get one depends on the following:

  • Your location (state/country laws)

  • The products you sell (regulated items require permits)

  • Whether you need to collect sales tax

  • If you want to register as an LLC or corporation

If your local government requires you to have a business license to sell online, then yes—you’ll need one for your Shopify store, even though Shopify itself won’t ask for it.

Lets dive into more details about each of these instances:

1. If Your Local or State Laws Require It

Most cities and states require online businesses to register and get a general business license—even if you run your store from home. This is key to ensuring your business is legal and can pay taxes.

2. If You Sell Restricted or Regulated Products

If you’re selling certain regulated items, you may also need special licenses or permits. Such products include:

  • Alcohol, tobacco, or vaping products

  • Supplements or health-related items

  • Firearms or ammunition

  • CBD or cannabis-related products

3. If You Need to Collect Sales Tax

If your business operates in a U.S. state that collects sales tax, then you may need a sales tax permit (also called a seller’s permit). This allows you to legally collect and pay sales tax on your products.

4. If You Want to Form an LLC or Corporation

Some Shopify sellers choose to form an LLC (Limited Liability Company) or corporation to protect personal assets and save on taxes. If you do this, you must register your business and obtain any necessary licenses.

5. If You Dropship on Shopify

Do you need a business license to dropship on Shopify? Well, not always…but it may also depend on your location. Keep in mind that:

  • Some states/countries require all businesses (including dropshipping) to register for a business license.

  • Some suppliers won’t work with you unless your business is registered.


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Do You Need an LLC to Sell on Shopify?

Do You Need an LLC to Sell on Shopify

No, you do not need an LLC to start selling on Shopify. You can operate a Shopify store as a sole proprietor without forming a legal business entity.

However, it’s worth noting that forming an LLC (Limited Liability Company) comes with a bunch of benefits, such as:

  • Protects your personal assets from business debts

  • Makes your business look more professional

  • LLC can provide you with tax benefits

If you plan to scale your Shopify store after acquisition and make it your primary income source, then we strongly encourage you to consider getting an LLC.


What Happens If You Run a Shopify Store Without a Business License?

What Happens If You Run a Shopify Store Without a Business License

If you’re wondering what could happen to your online business if you run it without a business license, this is your part.

Operating a Shopify store without the proper licenses could have the following consequences:

  • Fines & Legal Penalties: If your city/state requires you to have a license for an online store, and you don’t have one, then you risk being slapped with fines.

  • Tax Issues: Yes, if you fail to register for a sales tax permit but you still collect sales tax, then you could land yourself in hot soup.

  • Suspended Payment Accounts: It’s also worth noting that some platforms like Shopify Payments, PayPal, or Stripe may ask for your business registration proof. If you don’t have it, they may end up freezing your funds.

  • Supplier Restrictions: You may come across some suppliers who don't work with unregistered businesses, thus limiting your product options.

To ensure you’re always on the safer side of the law, we advise you to always check your local laws and get licensed if required.


How to Get a Business License for Your Shopify Store

How to Get a Business License for Your Shopify Store

If you check your local laws and determine that you need a license to run your Shopify store, here are the exact steps to follow to obtain one:

Step 1: Choose Your Business Structure

The first step is to decide your business structure. Here, you’ll mainly need to choose between sole proprietorship, LLC, and corporation. Let’s briefly describe each of them below:

  • Sole Proprietorship: This is the easiest option to consider (but keep in mind that you’re personally liable for debts).

  • LLC (Limited Liability Company): As we mentioned earlier, an LLC protects your personal assets and offers tax benefits.

  • Corporation: This is the best for large businesses, but it’s more complex.

Step 2: Register Your Business Name

Is your store name different from your legal name? If yes, then you may need to register a DBA (Doing Business As) with your local government.

Step 3: Apply for a General Business License

Visit your city, county, or state government website to apply.

Step 4: Get a Seller’s Permit (If Needed)

If your state requires sales tax collection, be sure to apply for a seller’s permit or sales tax license.

Step 5: Obtain Special Permits (If Required)

Check if your products require industry-specific licenses (e.g., health permits for supplements).


FAQs About Shopify Business Licensing

Questions About Shopify Business Licensing

Do You Need a Business License to Dropship on Shopify?

It depends on your location. Some states require all businesses (including dropshipping) to be registered, while others don’t. It’s best to check your local laws.

Do You Need a Business License for Shopify to Collect Sales Tax?

Yes, in most states, you need a sales tax permit if you collect sales tax from customers.

Do I Need an LLC to Sell on Shopify?

No, you can sell as a sole proprietor. However, an LLC can provide liability protection and tax benefits.


We Help You Buy / Build, Manage and Scale E-commerce Brands for an EXIT

E-commerce Simplified for Busy Individuals – We handle the buying, building, and scaling, so you can focus on what matters.

Growth-Focused Strategies – From sourcing to marketing, we drive growth and prepare you for a profitable exit.

Expertly Managed Exits – We build a high-value brand designed for a Lucrative exit.

Book Your Free Consultation

Book Your Free Consultation

Book Your Free Consultation

Final Thoughts

While Shopify doesn’t require a business license, your state, country, or industry regulations might. If you’re unsure whether you need a business license, check with your local government or consult a legal expert. It’s always better to start on the right foot than deal with problems later.

If you're unsure about the licensing process or want expert guidance on how to get started owning a Shopify store, we’re here to help. Our team specializes in assisting entrepreneurs like you to own e-commerce businesses without necessarily starting from scratch.

We help you spot the best deals, conduct due diligence to ensure compliance, and scale up your store for success. If you’re ready to start your journey of owning a Shopify store, click here to learn more about how we can help you.

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We help busy Individuals Build, Launch & Scale an E-commerce Business with the sole purpose of an Exit*

82A James Carter Road Mildenhall Suffolk IP287DE United Kingdom

7901 4th St N, Ste 300, St. Petersburg, FL 33702 United State

Support@trendhijacking.com

+44 20 3287 7320
+1 2136323209
Logo
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Company

E-commerce Businesses for Sale

*DISCLAIMER: All testimonials shown are real but do not claim to represent typical results. Any success depends on many variables that are unique to each individual, business, and product market opportunity, including commitment and effort. Testimonial results are meant to demonstrate what the most dedicated partners, clients, and students have done and should not be considered average. Trendhijacking.com makes no guarantee of any financial gain from the use of its products or services.
This site is not a part of the Facebook website or Facebook Inc. Additionally, This site is NOT endorsed by Facebook in any way. FACEBOOK is a trademark of FACEBOOK, Inc.
© 2025 Trendhijacking.com. All rights reserved.
Company No:
13503806

We help busy Individuals Build, Launch & Scale an E-commerce Business with the sole purpose of an Exit*

82A James Carter Road Mildenhall Suffolk IP287DE United Kingdom

7901 4th St N, Ste 300, St. Petersburg, FL 33702 United State

Support@trendhijacking.com

+44 20 3287 7320
+1 2136323209
Logo
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Company

E-commerce Businesses for Sale

*DISCLAIMER: All testimonials shown are real but do not claim to represent typical results. Any success depends on many variables that are unique to each individual, business, and product market opportunity, including commitment and effort. Testimonial results are meant to demonstrate what the most dedicated partners, clients, and students have done and should not be considered average. Trendhijacking.com makes no guarantee of any financial gain from the use of its products or services.
This site is not a part of the Facebook website or Facebook Inc. Additionally, This site is NOT endorsed by Facebook in any way. FACEBOOK is a trademark of FACEBOOK, Inc.
© 2025 Trendhijacking.com. All rights reserved.
Company No:
13503806