Pennsylvania Business License: What’s Actually Required (2026)

Last updated: August 10, 2026

Pennsylvania has no general state business license. What you actually need: an entity registered with the Department of State ($125 for an LLC), a free Sales Tax License through myPATH if you sell anything taxable, your city’s registration — in Philadelphia, a free Commercial Activity License — and a state professional license only if your occupation is regulated.

What makes Pennsylvania different isn’t the license — it’s everything around it. PA runs one of the most layered local tax systems in the country, and since 2025 it has a brand-new annual filing (the $7 Act 122 report) that most older guides don’t mention at all.

What Pennsylvania Actually Requires

• Entity registration ($125) — Certificate of Organization with the Department of State via file.dos.pa.gov, with a registered office address in PA.
• Act 122 annual report ($7) — new since 2025: every LLC files between January 1 and September 30 each year. Miss it starting in 2027 and administrative dissolution follows.
• Sales Tax License (free) — through myPATH, required once you sell taxable goods or services. The same registration opens employer withholding and UC accounts when you hire.
• City registration — Philadelphia requires the free Commercial Activity License and a BIRT account for every business; Pittsburgh registers businesses for its 0.55% Payroll Expense Tax; smaller municipalities license selectively.
• Professional licensing — barbers, cosmetologists, contractors on HICR, health professions, and other regulated fields license through their state boards.

What It Costs

Item	Cost	Renewal
Pennsylvania LLC (Certificate of Organization)	$125	Act 122 report: $7/year
Sales Tax License (myPATH)	Free	None
Philadelphia Commercial Activity License	Free	None
Professional / trade licenses	Board-specific	Varies

How to Get Set Up, In Order

1. Form the entity at file.dos.pa.gov ($125). Everything downstream — tax accounts, city licenses — issues to this entity.
2. Register on myPATH. One free registration covers the Sales Tax License and, when you hire, withholding and UC.
3. Register with your city. Philadelphia: Commercial Activity License + BIRT account. Pittsburgh: payroll tax registration. Elsewhere: ask the municipal office which activities they license.
4. Calendar the Act 122 window. January 1 – September 30, every year, $7. It’s new, it’s cheap, and from 2027 forgetting it can dissolve the company.

Pennsylvania Licenses by Industry

• Food trucks in Pennsylvania — our most-read PA guide: health licensing, Philly vending, commissaries
• Cleaning services in Pennsylvania — the no-license path, done correctly
• HVAC in Pennsylvania — municipal licensing in a state with no statewide HVAC license
• Daycare in Pennsylvania — DHS certification

The full walkthrough — local EIT/LST, Philadelphia BIRT and wage tax, workers’ comp from the first employee — is in our guide to starting a business in Pennsylvania.

Frequently Asked Questions

Does Pennsylvania require a business license?

No. Pennsylvania has no general state business license. Businesses register an entity with the Department of State ($125 LLC), get a free Sales Tax License through myPATH if they sell taxable goods or services, and add city registrations — like Philadelphia’s free Commercial Activity License — plus profession-specific state licenses where regulated.

How much is a Pennsylvania sales tax license?

Free. Register through myPATH (mypath.pa.gov), Pennsylvania’s tax portal, which also opens employer withholding and UC accounts in the same registration. PA sales tax is 6%, plus 2% local in Philadelphia and 1% in Allegheny County.

What licenses does Philadelphia require?

Every business operating in Philadelphia needs a Commercial Activity License (free) plus a Business Income & Receipts Tax (BIRT) account. Activity-specific licenses — food, contractors, vending — stack on top through the Department of Licenses and Inspections.

Sources

Source	What It Covers
PA Department of State — Business Filings	LLC formation, Act 122 annual reports
myPATH	Free Sales Tax License, withholding, UC registration
City of Philadelphia — Licenses	Commercial Activity License, BIRT, L&I licensing