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Is a Business License Required to Sell on Amazon Wholesale?

As an entrepreneur who want to become an Amazon business seller, there are many questions that you’ve probably asked yourself about selling products on Amazon Wholesale. One of these questions could be whether you need a business license or not.

In this guide, learn more about business license and sellers permit as they relate to selling on Amazon Wholesale.

What Is Amazon FBA Business?

FBA is an acronym for Fulfillment by Amazon. The term implies that as an Amazon business seller, your products are shipped by the Amazon Prime shipping services and that Amazon will be liable for anything that goes wrong during shipment.

Most sellers prefer an FBA option because it allows them to focus attention on other aspects of the business. Also, it is suitable when selling products that have international clients. This is due to the fact that sellers won’t need to worry about the varying import regulations.

Starting an Amazon Business Seller Account

Prior to obtaining the necessary licenses and permits that will authorize you to become an Amazon FBA seller, it is important to ensure that your business is set up legally. Most businesses often start as a sole proprietorship. Others are usually incorporated in various states with a master corporation controlling them.

Either way, it is important to note that a business that earns you over a certain amount set by the local tax authorities need to be incorporated, particularly for tax reasons. When incorporating, you can consider choosing between Limited Liability Corporation and a Corporation as both work best for small businesses.

Upon registering your business with the relevant authorities, your next step will be to get the necessary requirements that will enable you to operate as an Amazon seller or join an Amazon business seller program.

Do I Need a Business License to Sell on Amazon?

The answer to this question depends on the cities or towns where you want to operate your business. For most cities and towns, a business license is usually not required to sell products online and this includes Amazon.

However, there are a few cities and towns that required you to have a local business license if you are operating your business online. It is important, therefore, that you check with your local Chamber of Commerce to gain more insight on your city’s requirements

Do I Need a Sellers Permit to Sell on Amazon? 

Yes. As an online retailer who wholesale companies in order to re-sell, it is necessary that you obtain a sellers permit. You will require this permit to sell any product on Amazon and also when charging taxes. The taxes charged here are collected and then paid to the local jurisdiction.

Bottom Line

The question as to whether an Amazon business seller needs a business license to sell on Amazon wholesale or not depends on your city of residence. For most cities and towns, a business license is usually not required to sell products on Amazon.

However, there are a few exceptions, although they are rare. Make sure that you check with your local Chamber of Commerce to gain more insight on your city’s requirements

For a sellers permit, you will require it to sell products and also when charging taxes.

For additional questions about Amazon FBA business, Contact Us.