The Mount Rushmore State requires every new business registering in South Dakota to obtain a business license from the state, city or county in order to become operational. A business may require a license or even a permit while some businesses may not require any license at all.
Regulatory business licenses in South Dakota and permits are issued by different state agencies. It is important to note that if you fail to license your business as per requirement then it can most certainly lead to penalties. Most of the state licenses are issued by the following state agencies:
- South Dakota Animal Industry Board
- Department of Environment and Natural Resources
- Department of Agriculture
- Department of Game, Fish and Parks
- Department of Labor & Regulation
- Department of Health
- Department of Public Safety
- Department of Social Services
- Department of Revenue
- Department of Transportation
The question is how to begin the process?
Step-by-Step Guide to a Business License in South Dakota
Where and how do you apply for a South Dakota company license? Does your business entity require multiple permits or licenses? Does your business require a license or a permit? The only way to answer these questions is through an understanding of the process of business licensing.
Here is a step-by-step approach towards acquiring a business license in the state of South Dakota:
Step#1: The Industry or Business Type
How would you know what type of business or professional license is required to operate in South Dakota? The type of industry or the activities of a business entity helps in identifying the type of business license required.
Let’s take a look at some examples to understand this better:
Auction Agency – Livestock
According to the provisions of Chapter 40-15 of the South Dakota Code of Law, a Livestock Auction Agency will have to apply for a business license in order to conduct their business in the state.
- License is issued by: South Dakota Animal Industry Board
- License Fee: $100
Some of the other business activities for which the South Dakota Animal Industry Board issues a license include Livestock Dealers, Meat Plant, and Rendering Plant among others.
You will require a South Dakota company license if you are planning to start a business in the food service industry. The different types of businesses that fall under this category include Food Service Establishments, Temporary Food Services or food being served at temporary events, Mobile Food Services, Catering, Drive-in or Carry-out, Limited Menu Mobile Food, and Convenience Store.
- License is issued by: South Dakota Department of health
- Fee: The fee is dependent on the type of food service. For instance, the fee for a restaurant will depend on the seating capacity. You can also choose to apply for a full year fee (January 1 – December 31) or a half yearly fee (July 1 – December 31).
A restaurant with a seating capacity of 51-100 seats will require a business license fee of $230 annually while the fee for a Mobile Food Service and Limited Menu Mobile Food will be $88 annually. There will also be an initial license fee of $100 for all types of food services.
Step#2: Licenses issued by City/County
It is important to know that a business license in South Dakota is not always issued by the state agencies; sometimes they are issued by the city or county. Let’s look at an example to understand this:
If you are planning to set up business in the City of Sioux Falls, SD then you will have to apply for a license with the agency under which your business falls under. For example Family Daycare and Pest Control Agencies are regulated by the Sioux Falls Health Department – Environmental. According to the Zoning Department, Day Cares are classified as:
- Day Care Facility
- Day Care, Home
- Day Care, Family
- Day Care, Center
Similarly, if you were in the business of “Food Selling and Food Processing”, a permit will be issued instead of a business license by the Health Department of the City of Sioux Falls.
The permit would be valid from January 1 through December 31 and you will have to apply for renewal of the permit prior to December 31.
The annual permit fee is $181 although it can vary depending on the total square footage area.
Step#3: Issuance of a Business License
A business license in South Dakota will be issued by different state agencies and all you have to do is to complete the following process:
- Identify the type of business or industry
- Identify whether you need a license or a permit or both
- Identify whether it will be issued by the state or the city or county
Once you have identified the above, all you need to do is either download the application online or contact the concerned state department or city agency or clerk office.
It is important to note that a business license or permit will have to be renewed annually unless specific dates have been mentioned, to keep the business operational.