FREQUENTLY ASKED QUESTIONS
1. What is a Business License?
A business license is an excise tax levied on the privilege of conducting business in a particular jurisdiction.
2. Who needs a Business License?
Every person engaged or intending to engage in any business, occupation or profession in whole or in part within the city limits.
3. What do I have to do to get a Business License?
An application for a business license will be taken at 1339 Main Street. Before a license is issued, approvals by other divisions and state agencies may be required. The approvals required are dependent on the type of business and the physical location of the business.
4. What do you base your Business License fees on?
New businesses pay license fees on projected gross income from the start of business date through December 31st of that year. State law mandates that fees be paid on gross income without deductions for expense incurred for costs such as rents, salaries, cost of goods and other operational expenses.
Existing businesses must renew their business license annually. Renewal fees are based on the previous year’s gross income reported to the Internal Revenue Service. Businesses located outside the city limits of Columbia must report gross income exclusively for business conducted inside the city limits only.
All Business Licenses expire on December 31st of each year. As a courtesy, the Business License Division mails renewal forms at the beginning of the year in January. Second notices are mailed in late April or early May. License fees for businesses physically located within the city are due no later than April 15th of each year. Beginning on April 16th, a late penalty of five percent (5%) of the unpaid fee for each month or portion thereof is due until paid.
Non-resident businesses must renew their license prior to conducting business in the new calendar year. If you do not intend to conduct business in the city limits, please indicate this on your renewal form and return it to the Business License office.
If you do not receive your renewal form, please contact the Business License Division.
5. Is there anything I should do if my business location or activity changes during the year?
If your business moves to another location or the activity of your business changes, you should notify the Business License Office immediately. You will be required to obtain the approval of the appropriate city and state agencies depending on the new location and/or new activity of your business. A business license will not be issued for the new location or activity until this has been done.
6. What should I do if I sell or close my business?
You should notify the Business License Office in writing of the date that your business closed or was sold to another business or individual. Your written notification should be signed and dated.
7. Will the Business License issued by the jurisdiction where my office is located cover my business in another jurisdiction?
No. A business license is valid only within the jurisdiction that issues the license. If your business activities require you to physically conduct business inside another jurisdiction, you should check with that jurisdiction to see if they have a business ordinance and what you need to do to apply for a license.
8. Is a Business License transferable?
No. Business Licenses are not transferable and a transfer of ownership is considered as terminating the old business and establishing a new business which requires a new business license.
9. What is considered gross income for Business License purposes?
Gross income as defined by ordinance to mean the total received from the business operation without deductions of goods, overhead or salaries. It should conform to the gross figure reported on the business federal income tax return defined by the IRS Code Section 61 (a).
10. How do I determine if my location is zoned for my type of business?
Please contact the Zoning Division at 803-545-3333 to discuss location and options.
11. I am working for someone who has a Business License already, do I need a Business License?
If you are not on that company’s payroll with taxes deducted out of your paycheck, but you receive a 1099 form instead then you are considered self-employed and a business license is required.
12. How do I register the name of my business?
The City of Columbia does not register names of any businesses, but we can assist with determining whether or not anyone is presently using your potential business name within the City of Columbia. You may also contact the Secretary of State office to verify if anyone has incorporated the name you would like to use and inquire about the laws governing this issue.