How to Get a Tennessee Liquor License

By StartBusinessByState·Publisher: Robert Smith·Research process

Last updated: October 2, 2026

Tennessee cards the server and then splits the business license: restaurants pay by seats, bars pay by how little food they sell. Anyone serving liquor, wine or high gravity beer at an on-premise establishment needs a Server Permit — $20, after a TABC certified alcohol awareness course of at least 3.5 hours, with a sixty-one day grace period from the day you were hired. A restaurant liquor-by-the-drink license runs $650 to $1,200 a year by seating; a limited service restaurant (prepared food 50% or less) pays $2,000 to $5,000. Mixed drinks also carry a 15% liquor-by-the-drink tax. And forming the company itself is unusual here: Tennessee charges $50 per member, minimum $300 — every year.

The Server Permit: Required, With a 61-Day Clock

A Server Permit (On-Premise Permit) is required to serve liquor, wine and high gravity beer at an establishment holding an On-Premise Consumption License:

• $20.00 to TABC, plus the course fee charged by the private provider.
• Age 18 at minimum.
• Complete a TABC certified alcohol awareness program of at least 3.5 hours within one year of the Server Permit application date. Passing the class is not the same as holding the permit.
• Sixty-one day grace period from the original hire date for a new server to finish the requirements and obtain the permit. It is a one-time grace period — not available each time you change employers.
• Two-year term for permits issued on or after 1 January 2025; permits issued before that date run five years.
• A wrinkle worth knowing: TABC’s fee schedule still lists the line as “Server (5 Years) $20.00” while its permitting page states the two-year rule for newer permits. The fee is not in dispute; the term labeling is inconsistent between TABC’s own pages, so confirm your expiry with TABC rather than assuming five years.

The Business License: Seats, or Food Percentage

Tennessee issues liquor-by-the-drink licenses in more than one shape. A food-led restaurant pays by seating capacity. A drinks-led room uses a limited service restaurant license priced by how much prepared food it sells. Both need at least 40 seats at tables.

• Restaurant, liquor by the drink: $650 (40–74 seats), $750 (75–125), $925 (126–175), $975 (176–225), $1,100 (226–275), $1,200 (276 and over).
• Restaurant Wine Only: $270 (40–125 seats), $300 (126–175), $310 (176–225), $330 (226–275), $350 (276 and over).
• Limited service restaurant — prepared food 50% or less of sales (chips, popcorn, pretzels, peanuts and similar snacks do not count): $2,000 (30%–50% food), $3,000 (20%–29%), $4,000 (15%–19%), $5,000 (0%–14%).
• Application fee — $300 on a new liquor-by-the-drink application, before the annual license fee.
• Caterer: $625. Clubs: $500.
• Every server needs their own permit — the business license does not cover the staff.
• Beer is a separate local permit. Regular beer is issued by your city or county beer board. The TABC liquor-by-the-drink license covers liquor, wine and high gravity beer, not that local beer permit.

What It Costs

Item	Cost	Notes
Server permit	$20	Required; 3.5-hour course within one year of application; 61 days from hire, one time
Alcohol awareness course	Provider-priced	Must be TABC certified and at least 3.5 hours
Liquor-by-the-drink application	$300	Paid with a new application
Liquor by the drink — 40–74 seats	$650	Restaurant; 40-seat minimum
Liquor by the drink — 75–125 seats	$750
Liquor by the drink — 126–175 seats	$925
Liquor by the drink — 176–225 / 226–275 / 276+	$975 / $1,100 / $1,200
Restaurant Wine Only	$270–$350	By seating bands
Limited service restaurant	$2,000–$5,000	By prepared-food percentage; the bar path
Liquor-by-the-drink tax	15%	Of the sales price of alcoholic beverages sold for on-premises consumption
Caterer / Clubs	$625 / $500
Tennessee LLC	$50 per member, $300 minimum	Capped at $3,000; the same formula applies to the annual report

Tennessee Charges You by the Member — Every Year

The licensing side of Tennessee looks straightforward until you see the two price lists. A food-led restaurant pays by seat count. A drinks-led room pays as a limited service restaurant, by how little prepared food it sells — $2,000 to $5,000 a year instead of $650 to $1,200. Crossing that 50% food line is a business-model choice with a four-figure price attached.

Then there is the tax that never appears on the TABC fee schedule. Mixed drinks sold for on-premises consumption carry a 15% liquor-by-the-drink tax on the sales price, collected by the Department of Revenue. A cocktail bar’s cost of goods is the pour cost plus that 15%, every night, on top of the license.

The part that still surprises people sits one step earlier, in forming the company. Tennessee’s LLC filing fee is $50 multiplied by the number of members, with a floor of $300 and a ceiling of $3,000. A single-member LLC pays the $300 minimum — already three to six times what most states charge. A six-member partnership pays $300. A ten-member group pays $500.

And it repeats. The identical formula — $50 per member, $300 minimum, $3,000 maximum — applies to the annual report every year the company exists. Most states charge a flat annual fee measured in tens of dollars, or nothing at all. In Tennessee a multi-member restaurant LLC carries a recurring state cost that scales with how many people own it, which is worth knowing before you decide how many partners go on the paperwork.

Set against that, a 100-seat restaurant license is moderate: $750 a year for liquor by the drink, or $270 if wine is all you need, plus the $300 application fee the first time. Count seats against the bands before you file, because crossing a threshold moves you into the next bracket, and 39 seats is not a restaurant license at all.

How to Get Licensed, In Order

1. Count seats at tables — restaurants and limited service restaurants need at least 40, and the restaurant fee bands are narrow.
2. Decide restaurant, limited service restaurant, or wine-only. Food-led rooms pay $650–$1,200 by seats; drinks-led rooms pay $2,000–$5,000 by food percentage.
3. Register the entity with the Secretary of State — $50 per member, $300 minimum — and remember the annual report repeats the formula.
4. Apply to TABC with the $300 application fee, and apply to your city or county beer board if you will sell regular beer.
5. Get every server permitted: TABC certified 3.5-hour course, then the $20 permit, inside the 61-day window from hire.
6. Register for the 15% liquor-by-the-drink tax with the Department of Revenue, and diary server-permit expiries — two years for permits issued from 2025 onward.

Staying Licensed

Restaurant liquor-by-the-drink licenses renew annually at the fee for your seating band, so a renovation that adds tables can move you into a more expensive bracket. Limited service restaurants renew on the food-percentage schedule — a year of stronger food sales can drop the fee, and the reverse can raise it. Server permits run two years for anyone permitted from 2025 onward, and Tennessee does not offer a shortened refresher — the full certified course is taken again. The 15% liquor-by-the-drink tax is ongoing, not a filing at issuance. The LLC annual report repeats the $50 per member, $300 minimum formula every year, which is the ongoing cost most easily forgotten.

Frequently Asked Questions

Do you need a server permit to bartend in Tennessee?

Yes. Tennessee requires a Server Permit to serve liquor, wine and high gravity beer at an establishment holding an On-Premise Consumption License. You must be at least 18, complete a TABC certified alcohol awareness program of at least 3.5 hours within one year of your permit application date, and a new server gets a sixty-one day grace period from the original hire date. That grace period is one-time — it is not available each time you change employers.

How long is a Tennessee server permit valid?

Two years, if it was issued on or after January 1, 2025. Permits issued before that date remain valid for five years. Be aware that TABC’s fee page still labels the line item ‘Server (5 Years)’ at $20.00 while its permitting page states the two-year rule for newer permits — if the two do not match for your situation, confirm with TABC rather than assuming the longer term.

How much does a Tennessee server permit cost?

$20.00 to TABC for the permit itself, plus whatever the certified alcohol awareness course costs — those are sold by approved private providers at their own prices. The course must be at least 3.5 hours and completed within one year of your application date.

How much is a liquor-by-the-drink license in Tennessee?

A restaurant license is priced by seating capacity, and you need at least 40 seats. Forty to 74 seats pays $650, 75 to 125 pays $750, 126 to 175 pays $925, 176 to 225 pays $975, 226 to 275 pays $1,100, and 276 and over pays $1,200. A wine-only restaurant license runs $270 to $350 across seating bands. There is also a $300 application fee. A limited service restaurant — the bar path, where prepared food is 50% or less of sales — is priced by food percentage at $2,000 to $5,000 instead of by seats.

What is a limited service restaurant license in Tennessee?

The liquor-by-the-drink license for a place that is not primarily a restaurant. Prepared food is 50% or less of sales (chips, popcorn, pretzels, peanuts and similar snacks do not count as prepared food), you still need at least 40 seats at tables, and the annual fee is $2,000 (30%–50% food), $3,000 (20%–29%), $4,000 (15%–19%), or $5,000 (0%–14%). A food-led restaurant uses the cheaper seating-priced license instead.

Do mixed drinks carry an extra tax in Tennessee?

Yes. On top of the license fee, Tennessee levies a liquor-by-the-drink tax of 15% of the sales price of alcoholic beverages sold for consumption on the premises. That is a Department of Revenue tax, not a TABC permit fee, and it applies whether you hold a restaurant license or a limited service restaurant license.

What does a Tennessee LLC cost to form?

More than most states, and it scales with your membership. Tennessee charges $50 per member, with a minimum of $300 and a maximum of $3,000. A two-member LLC still pays the $300 floor. The same formula applies to the annual report every year after, so a multi-member LLC carries an ongoing cost that single-member LLCs in other states never see.

Does a Tennessee restaurant need a separate wine license?

It depends what you pour. The liquor-by-the-drink license covers spirits, wine and high gravity beer. If you only want wine, the Restaurant Wine Only license costs far less — $270 for 40 to 125 seats up to $350 for 276 seats and over — which makes it a sensible route for a restaurant that does not need a full bar. Regular beer is a separate local beer-board permit and is not covered by the TABC liquor-by-the-drink license.

Forming the company, taxes, insurance, and hiring are covered in our full guide to starting a business in Tennessee.

Sources

Source	What It Covers
Tennessee ABC — Server Permit (On-Premise Permit)	Who needs the permit, age 18, the TABC certified alcohol awareness program within one year of application, the sixty-one day one-time grace period from original hire date, and the two-year term for permits issued on or after January 1 2025
Tennessee ABC — Fees	Server permit $20.00, liquor-by-the-drink restaurant fees by seating capacity from $650 to $1,200, Restaurant Wine Only $270 to $350, Limited Service Restaurant $2,000 to $5,000 by prepared-food percentage, Caterer $625, Clubs $500
Tennessee ABC — Limited Service Restaurant License	Seating capacity for at least forty at tables; prepared food fifty percent (50%) or less; chips, popcorn, pretzels, peanuts and similar snack items not counted as prepared food
Tennessee ABC — Frequently Asked Questions	Restaurant and limited service restaurants must maintain minimum seating for forty (40) people; alcohol awareness training at least 3.5 hours
Tennessee ABC — Liquor-by-the-Drink Applicant Guide	$300 application fee on a liquor-by-the-drink application
Tennessee Department of Revenue — Alcohol Tax Manual (June 2025)	The liquor-by-the-drink tax rate is 15% of the sales price of all alcoholic beverages sold for consumption on the premises
UT CTAS — On-Premises or Off-Premises Consumption	Beer is permitted by the city or county; a business may sell beer for both on-premises and off-premises consumption under the same permit, T.C.A. 57-5-103
Tennessee ABC	The Alcoholic Beverage Commission and its permitting responsibilities
Tennessee Code § 48-249-1007(d)	LLC initial and annual filing fee of fifty dollars multiplied by the number of members, no less than three hundred dollars and no more than three thousand dollars