How to Get a Business License in Ohio

Ohio is affordable to start — but has some unique wrinkles

Ohio is one of the cheaper states to form a business. LLC filing is $99, there is no state business license, and the overall regulatory environment is lighter than California or New York. But Ohio has two features that trip up new business owners: nearly every city has its own income tax, and workers' compensation runs through a state monopoly. Neither of these is hard to deal with — but you need to know about them.

Step 1: Register your business entity

File with the Ohio Secretary of State.

LLC: File Articles of Organization. Costs $99. File online through the Ohio Business Central system.
Corporation: File Articles of Incorporation. Also $99.
Sole proprietorship: No state filing required, but you need a fictitious name registration if operating under a name other than your own — filed with the county recorder.

Online filing is typically processed within 3 to 5 business days. Expedited processing is available for an additional $100 (24 hours) or $200 (same day).

Step 2: File your fictitious name (trade name)

In Ohio, trade name (fictitious name) registrations are filed with the Secretary of State. The cost is $39 for online filing. Unlike some states where this goes through the county, Ohio handles it centrally.

Step 3: Get your EIN

Free, online, immediate at irs.gov.

Step 4: Register with the Ohio Department of Taxation

Vendor's license: If you sell tangible goods at retail, you need a vendor's license for each location. The cost is $25 per location. This is your sales tax permit — Ohio's state sales tax rate is 5.75%, plus county surtaxes of 0.75% to 2.25%.
Employer withholding: Register if you have employees.
Commercial Activity Tax (CAT): If your gross receipts exceed $150,000 annually, you must register for the CAT. The rate is 0.26% on gross receipts over $1 million.

Step 5: Register with the Bureau of Workers' Compensation

Ohio is one of four states with a state-run workers' compensation system (the others are North Dakota, Washington, and Wyoming). You do not buy workers' comp from a private insurer — you get it from the Ohio Bureau of Workers' Compensation (BWC).

Nearly all Ohio employers with one or more employees must carry BWC coverage. Register through the BWC website when you hire your first employee. Rates vary by industry — a desk job pays less than a construction company.

Step 6: Register for city income tax

This is the one that surprises people from other states. Almost every city in Ohio — over 600 of them — levies a municipal income tax. If you operate a business in a city that has one (most do), you need to register with that city's income tax department.

Columbus: 2.5% city income tax. Register through the Columbus Income Tax Division.
Cleveland: 2.5% city income tax. Register through the Cleveland Division of Taxation.
Cincinnati: 1.8% city income tax.
Toledo: 2.5% city income tax.

If you have employees who work in a city with an income tax, you also need to withhold city tax from their paychecks. If your employees live in a different city than where they work, there may be credit provisions — but you still need to register in both cities. It is a lot of paperwork.

Step 7: Get your local business license

Ohio's cities handle business licensing differently:

Columbus: Does not require a general business license, but certain business types need specific permits.
Cleveland: Requires a vendor's license for retail businesses and specific permits for regulated industries.
Cincinnati: Requires a Business License Certificate through the city.
Smaller cities and villages: Some require a business license; many do not. Check with your local government.

Step 8: Industry-specific permits

Restaurants: Food service operation license from the Ohio Department of Health or your local health district.
Bars: Liquor permit from the Ohio Division of Liquor Control.
Contractors: Ohio does not have a state general contractor license. However, specific trades (electrical, plumbing, HVAC) require licenses through the Division of Industrial Compliance or local municipalities.
Salons: Licensed through the Ohio State Cosmetology and Barber Board.

What it costs: Ohio business setup fees

Item	Cost	Frequency
LLC filing (Secretary of State)	$99	One-time
Trade name registration	$39	Every 5 years
EIN (IRS)	Free	One-time
Vendor's license (sales tax)	$25 per location	Annual
City income tax registration	Free	One-time (ongoing tax filing)
BWC workers' comp	Varies by industry	Annual
City business license (where required)	$25 - $200	Annual
Liquor permit	$2,500 - $6,000+	Annual
Health department license	$100 - $500	Annual

Timeline: how long does it take?

Step	Processing Time
LLC filing (online)	3 - 5 business days
LLC filing (expedited)	Same day to 24 hours
EIN	Immediate (online)
Vendor's license	1 - 3 weeks
BWC registration	1 - 2 weeks
City income tax registration	1 - 2 weeks
Liquor permit	60 - 120 days
Health permit	2 - 4 weeks

Ohio-specific gotchas

City income tax is everywhere. If you are from a state without local income tax, this will feel strange. Over 600 Ohio municipalities levy their own income tax. Your business needs to register and file in every city where it has employees or operations. There is a statewide portal (RITA — Regional Income Tax Agency) that handles filing for many cities, which helps.
BWC is mandatory and state-run. You cannot shop for workers' comp from private insurers in Ohio. The BWC sets the rates, and you pay them. The rates are competitive, but you have no choice of carrier. Failure to register carries penalties including personal liability for the business owner.
Vendor's license renewal: Your vendor's license expires every year on the last day of February. You must renew before it expires. Operating without a valid vendor's license means you are collecting sales tax illegally — which brings both tax penalties and potential criminal charges.
No state LLC annual report. Ohio does not require LLCs to file annual reports. This saves you money and hassle. But it also means the state will not remind you about anything — maintaining your registrations, licenses, and filings is entirely on you.
Commercial Activity Tax catches people off guard. The CAT is not an income tax — it is a tax on gross receipts. That means you owe it even if your business is not profitable. The threshold is $150,000 in gross receipts, which most active businesses hit within the first year or two.

Get your Ohio permits sorted

Ohio is affordable and reasonably straightforward for business formation. The tricky parts are the city income tax (make sure you register) and the BWC workers' comp (make sure you enroll). Everything else is standard.

Use the free permit checker to see the full list of permits your Ohio business needs. Enter your business type and location, and it shows you every agency, fee, and deadline in one place.

If you are tracking multiple permits across multiple Ohio cities, a permit tracker will save you from the inevitable missed renewal.