The short answer
Licenses, permits and compliance cover the trade licenses, job permits and safety, access and advertising rules that apply to the work you do. They matter because working without the right license or permit can bring fines, stop work orders, voided contracts and trouble getting paid or insured.
Key Points
The three things to take away.
- 1
Find every rule that applies
Start by listing the exact work you do, then check federal, state, county and city rules for each piece. Trades like electrical, plumbing, HVAC and general contracting are licensed or registered at the state or local level in most places. Other fields, such as food, childcare and cosmetology, have their own boards.
The SBA website has a guide to federal and state licenses, and your state licensing agency lists trade requirements. In Idaho, for example, contractors register with the Idaho Contractors Board, and HVAC, electrical and plumbing work each have their own licensing board. Rules vary widely, so call the agency, describe your work and write down what they tell you and who you spoke with.
- Write a list of every service you offer
- Check the SBA license guide and state boards
- Call the local building and planning office
- Record each answer with name and date
- 2
Get, track and renew permits
Pull the right permit before work starts, not after. Building, electrical, plumbing, mechanical and sign permits usually come from the city or county building department. Many offer online portals where you apply, pay, schedule inspections and download approvals.
Track each permit by job, with the permit number, inspection dates and final sign-off. Keep your own licenses and certifications on the same list with renewal dates and any continuing education hours required. Set reminders well ahead of each expiration. A lapsed license can stop you from pulling permits and can make insurance claims harder.
- Check permit needs before you quote a job
- Log each permit number by job
- Schedule and record every inspection
- Set renewal reminders for your licenses
- 3
Fire, health and environment
Find out which fire, health and environmental rules touch your work and your shop. This can include fire code inspections for a commercial space, health permits for food, rules for storing fuel and chemicals and rules for disposing of paint, oil, batteries or construction debris.
If you work on older homes that may have lead paint, the EPA lead-safe rule requires firm and renovator certification for many renovation, repair and painting jobs. HVAC techs who service or dispose of equipment with refrigerant need EPA Section 608 certification. Your local fire marshal, county health district and state environmental agency can tell you what applies. Keep safety data sheets for chemicals you use, and know where your waste legally goes.
- Ask the fire marshal about your space
- Check health and environmental rules
- Get EPA lead-safe or 608 certified if needed
- Keep safety data sheets on hand
- 4
Job site and worker safety
Follow OSHA rules on your job sites and in your shop, and put your safety practices in writing. Common needs include fall protection, ladder safety, eye and hearing protection, trenching rules and a written hazard communication program for chemicals.
Some states run their own OSHA-approved plans with added rules, so check your state. Train your crew, write down who was trained and when, and hold short safety talks on site. Report serious injuries as OSHA requires. Your workers' comp carrier often offers safety materials at no charge and can help you set up a program that fits your work.
- Learn the OSHA rules for your trade
- Write a simple safety program
- Train the crew and log each session
- Ask your insurer for safety resources
- 5
Access for every customer
Make your place of business and your website usable by people with disabilities. The Americans with Disabilities Act covers businesses open to the public, including entrances, parking, restrooms and service counters. Some states add their own rules.
Online, the Justice Department points to the WCAG guidelines as a helpful standard. Use readable text, real text instead of text inside images, alt text on photos, clear form labels and good color contrast. Make sure the site works with a keyboard and a screen reader. An online accessibility checker catches many common issues, but check the site by hand too. Offer a phone number and email so anyone can reach you another way.
- Walk your space and note access barriers
- Add alt text and labels on your website
- Run an online accessibility checker
- List a phone and email on every page
- 6
Honest ads and special work
Keep every ad, review request and claim on your website truthful and backed up. The FTC rules on advertising, endorsements and reviews apply to small businesses too. Do not post fake reviews, pay for reviews without disclosure or claim licenses, warranties or results you cannot prove.
Many states require contractors to show a license or registration number on ads, trucks, websites and contracts, so check yours. Some work carries extra rules, such as home improvement contract notices, telemarketing and texting consent, and work for government agencies. Ask your attorney before you start a new kind of work or marketing.
- Back up every claim you make in ads
- Show your license number where required
- Ask for reviews without paying for them
- Get consent before marketing texts or calls
Mistakes to avoid
- Starting a job before the permit is issued to save a few days.
- Letting a trade license lapse because the renewal notice went to an old address.
- Leaving the license number off the website, truck or contract where it is required.
Common questions
How do I find out what licenses my business needs?
Check the SBA license guide, your state licensing agency and your city and county offices. Describe your exact work and location, and write down each answer. Rules differ a lot by state and city.
Who pulls the building permit, the contractor or the homeowner?
In most places the licensed contractor doing the work pulls the permit, though some areas allow homeowners to pull their own for work they do themselves. Check with your local building department, since rules vary.
Does my small business website need to be accessible?
Many courts have treated business websites as covered by accessibility laws, and an accessible site helps more customers reach you. Use alt text, clear labels, good contrast and keyboard-friendly design. Ask an attorney if you get a complaint.
Do I need to show my contractor license number on my website?
Many states require it on ads, websites, vehicles and contracts. Check your state licensing agency for its exact rule. Showing it also builds trust with customers.
General information only, not legal, tax or financial advice. See the Disclaimer.