The Complete Guide to Pennsylvania Business Licenses
Pennsylvania does not issue a general state business license. Forming your LLC with the Department of State registers the company; licensing then happens through state tax registration, local registration in your city, and professional licenses for regulated work. This guide walks through each step for a new Pennsylvania business.
Step 1: Form the LLC
File a Certificate of Organization with the Pennsylvania Department of State. The state fee is $125, and Pennsylvania requires a registered office address in the state — out-of-state owners usually name a Commercial Registered Office Provider. Since 2025 every LLC also files a $7 annual report between January 1 and September 30; starting with reports due in 2027, LLCs that skip it can be administratively dissolved. See the Pennsylvania LLC guide for every formation step.
Step 2: Register for state taxes on myPATH
Businesses register for Pennsylvania taxes through myPATH, the Department of Revenue's online system. One registration covers several accounts:
- Sales, Use and Hotel Occupancy Tax License: required before you sell taxable goods or services in Pennsylvania, including online sales to Pennsylvania customers. The state rate is 6%; Allegheny County adds 1% and Philadelphia adds 2%. Returns are due for each filing period even when you made no taxable sales.
- Employer withholding: needed before your first payroll.
- Unemployment compensation: employers also register with the Department of Labor & Industry for UC tax.
Use your sales tax license number when you give suppliers a resale certificate to buy inventory without paying tax — see our resale certificate guide.
Step 3: Local registration — Philadelphia, Pittsburgh and other cities
Pennsylvania's licensing is mostly local, and the rules differ by municipality:
- Philadelphia: any person or entity doing business in Philadelphia — including businesses based outside the city — needs a Commercial Activity License. It is free, does not need to be renewed, and is issued online through the city's eCLIPSE system. You first need a Business Income and Receipts Tax (BIRT) account and must be current on city taxes. Get this license before applying for any other Philadelphia license.
- Pittsburgh: new businesses register with the City of Pittsburgh's Department of Finance for local business taxes, including the payroll expense tax for employers.
- Other municipalities: many boroughs and townships require a local business registration or mercantile license, and most levy an earned income tax through the local tax collector. Check with your municipal office before you open, and confirm zoning for your location.
Step 4: Professional and occupational licenses
Pennsylvania's Bureau of Professional and Occupational Affairs oversees the state licensing boards for professions such as accountants, architects, engineers, nurses, cosmetologists, barbers, real estate brokers and many health professions. Home improvement contractors register with the Pennsylvania Attorney General's Office before doing home improvement work. Restaurants and food businesses need health permits from the Department of Agriculture or the local health department, and alcohol sales are licensed by the Pennsylvania Liquor Control Board.
Fictitious names (DBA)
If your LLC trades under a name other than its exact legal name, register a fictitious name with the Pennsylvania Department of State. Philadelphia also requires any trade name to be listed on your city tax account before the Commercial Activity License is issued.
Checklist
| Registration | Agency | Who needs it |
|---|---|---|
| Certificate of Organization ($125) and $7 annual report | Department of State | Every Pennsylvania LLC |
| Sales tax license | Department of Revenue (myPATH) | Sellers of taxable goods or services |
| Employer withholding and UC accounts | Revenue / Labor & Industry | Businesses with employees |
| Commercial Activity License (free) | City of Philadelphia | Anyone doing business in Philadelphia |
| Local business tax registration | Your city or township | Most businesses, depending on location |
| Professional or trade license | State licensing boards / Attorney General | Regulated professions and contractors |
Frequently Asked Questions
Does Pennsylvania require a business license?
There is no general statewide business license. Most businesses register for state taxes through myPATH, register with their city or township, and get a professional license only if their work is regulated.
How much is a sales tax license in Pennsylvania?
You register for the Sales, Use and Hotel Occupancy Tax License through the Department of Revenue's myPATH system. The state sales tax rate is 6%, plus 1% in Allegheny County and 2% in Philadelphia.
Do I need a business license in Philadelphia?
Yes. Anyone doing business in Philadelphia needs a Commercial Activity License. It is free, does not expire, and is issued online through eCLIPSE once you have a Business Income and Receipts Tax account.
How much does it cost to form an LLC in Pennsylvania?
The Certificate of Organization costs $125, and every LLC files a $7 annual report each year between January 1 and September 30.
Does a Pennsylvania LLC need a business license?
Forming the LLC registers the company but is not a license to operate. The LLC still needs the tax registrations, local registrations and professional licenses that apply to its business.