Licenses and Permits Required to Open a Restaurant
- Business License
- Employer Identification Number (EIN)
- Certificate of Occupancy
- Food Service License
- Sign Permit
- Music License
- Resale Permit
- Building Health Permit
- Employee Health Permit
- Seller’s Permit
- Liquor License
- Valet Parking Permit
- Dumpster Placement Permit
- Live Entertainment License
What Do You Need to Open a Restaurant?
1. Business License
Step one: a business license. This is required to open and operate any business in Nevada.
This license legitimizes new businesses as legal entities. Depending on the specific location of your new restaurant, you may be required to pay a percentage of your total sales or a flat yearly fee.
If your restaurant sells alcohol, you will need to obtain a federal business license and a state business license. If not, you may just have to obtain a state business license.
2. Employer Identification Number (EIN)
Like a business license, all businesses must also obtain an employee identification number in order to operate in the U.S. An EIN is assigned by the IRS and it is really just a tax ID number. Prepare to sit on this one for a while – the IRS only issues one EIN per day.
3. Certificate of Occupancy
Once your location has passed the final building inspection, the local building or zoning department in your city will issue a certificate of occupancy. The certificate of occupancy certifies that the building has been properly constructed and maintained.
4. Food Service License
Food service licenses are generally issued by the city or county health department. The health department will make an in-person visit to your establishment to ensure that you are following all restaurant food safety regulations. Once this license is obtained, the health department will continue to make regular visits to inspect your restaurant.
And make sure to keep up to inspection standards: if you fail an inspection at any point, you could risk being stripped of your food service license.
5. Sign Permit
Your sign is an important part of building your brand as part of your restaurant marketing plan. Before you put up any signs to draw attention to your restaurant, you will need a sign permit from the city. The specifications around what is acceptable with regards to size, location, and lighting vary by city. If you rent or lease the building, it is also a good idea to get written approval from your landlord in addition to the official sign permit.
6. Music License
Music is essential to a restaurant experience: adding to the ambiance, mood, and individual aesthetic. To play music in your restaurant, you’ll need a music license to avoid copyright infringement. This includes live music, as well as music from a CD, or streaming service.
The fines for playing copyrighted music without a license can range from $750 to $30,000.
Plus, nobody wants to get sued by Beyoncé. To protect your business from these fines, make sure you’ve secured a music license before you hire that DJ or host a karaoke night.
7. Resale Permit
A resale permit allows your restaurant to make certain nontaxable purchases (wholesale food inventory, for example) if these items are purchased for use in the manufacture of products for resale (meals). This way, resale certificates prevent the double collection of sales tax on these types of products; rather than collecting sales tax on the product when you buy it, it’s collected when your customer buys it. The state then requires the business to report regularly on sales tax collected and pay it to the state.
8. Building Health Permit
Remember when your restaurant operation was inspected for the food service license? Your building might also have to be inspected for the building health permit, if your state requires it, especially if you’re building an establishment from the ground up.
Normally, a restaurant obtains a health permit from the city or county health department when applying for a business license. The location will be subject to periodic health inspections to ensure the location is sanitary.See what type of permits your business needs.
9. Employee Health Permit
Not only does the building need a health permit; the employees handling food and beverages need one too. The FDA has specific training resources for employee health and foot protection. Usually, employees must complete a state-approved food handler’s course and purchase a food handler’s permit. The food handler’s course teaches employees about proper sanitation practices, food storage, and food handling, to avoid spreading food-borne disease.
10. Seller’s Permit
Most businesses, especially in the food and beverage industry, need to obtain a seller’s permit as well as the resale certificate.
11. Liquor License
If you plan to serve alcoholic beverages, you will need to apply for a liquor license. In certain states, you may be required to apply for both a liquor license and a beer and wine license. Start this process as early as possible. Depending on the location, it can take months to complete the application process and receive a liquor license from the city government’s liquor control board.
You can learn more about this process here.
12. Valet Parking Permit
If you are planning on opening a fine dining or full-service restaurant, you may wish to offer valet parking to guests. However, you will need to apply for a valet parking permit in order to do so.
13. Dumpster Placement Permit
Not often considered, but often needed, the dumpster placement permit allows your restaurant to situate a state dumpster outside your kitchen, where chefs can dispose of food waste.
The stipulations and cost of the dumpster placement permit depend on the size of the dumpster, the exact placement of it, and the restaurant’s location.
14. Live Entertainment License
Live events are a great way to bring in new guests to your restaurant.
If you plan to host live events in your restaurant or bar, then you will need to apply for a live entertainment license.
15. Pool Table License
Some states and counties require restaurants and bars to apply for a pool table license in order to offer a pool table to customers. The applicant will be considered based on location (is there a high amount of pedestrian traffic or parking traffic) and can limit the hours of operation of the pool table and the number of pool tables allowed.