Answer to all the common questions for trade license that freelancers, bloggers or solopreneurs may have when working from home
Let me answer all the common questions that freelancers and bloggers may have related to getting a trade license.
What is a Trade License?
Trade License is a license or a permit issued by the municipal corporation or local panchayat to allow an individual or a business to carry out a particular type of business or trade for which it is issued in the given premises.
The trade license is obtained from the local government body. So the process can vary based on where you are applying for it.
Fees (Annual renewal as well as a first-time application) for a trade license can also vary considerably depending on the trade license issuer for you.
Normally in cities, it is the municipal corporation who issues the trade licenses.
Why Do You Need a Trade License?
Trade license ensures that business carried within the city is according to the rules, standards, and safety guidelines. You just cannot set up a mini manufacturing unit in your residence.
Trade licenses are governed by a set of rules that licensee needs to abide by. Violations can lead to the license being canceled.
Do individual Freelancers / Bloggers need a Trade License?
As per the Municipal Corporations, every person or business engaged in any kind of trade, business or profession is required to obtain a trade license. So yes it is mandatory for freelancers and bloggers to have one.
However, when you want to start as a blogger or freelancer, one can do it without it. So, one can get started without a trade license but it is good to have one once you are doing it as a full time. Moreover. it doesn’t cost a fortune to have one and the process is really simple. So I don’t see a reason for not having one.
Can any freelancer/ blogger get a Trade License?
Freelancer doing work from home on his computer or laptop does not have any major licensing conditions that can be violated and so can get a trade license on his residential address.
If you are living in a rented flat, you may need permission from your owner to get a trade license in his premises but if you are in living in your own flat, I don’t see any other issue for getting a trade license apart from the municipal tax being fully paid for your premise.
Still, I will suggest you contact your local municipality to enquire about trade licenses. It should be a fairly straight forward process and should not take more than a few days to get one.
What documents does one need for Trade License?
Documents can vary depending on the municipality to the municipality but I will share a general list of documents.
For individuals application form duly filled up along with KYC documents (photo id and address proof) of all individuals along with proof of occupancy of the business
- If you are on a rented flat, rent agreement.
- As an owner of the flat, tax bill.
- If relative granted rent-free accommodation like the flat is in your dad’s name and you want trade license in your name then a consent letter from the owner along with the tax bill.
There can be other complex scenarios like a subtenant but instead of me going into details of those, it’s better if you consult your local municipality about the exact documents needed in such cases.
For companies, you may need a few extra documents like
- Memorandum/Articles of Association
- Declaration in Form No. 32
- Form No. 18
What is the timeline for getting a trade license?
Normally it takes 1 week but, then you can never be sure about the timeline from the Government body. So practically it can take up to a month but if you have applied for a trade license, the receipt of the application is as good as a trade license if you need it.
Over to You
Do you have any other queries about Trade licenses? Let me know via the contact form and I will be more than happy to add them here.