Who needs a business license?
Do I need a business license?
What is a business license?
Why do I need a business license?
When do I need a business license?
How much does a business license cost?
What is "gross income" or "gross receipts"?
Does a business license expire?
Are any businesses exempt from obtaining a business license?
Do I have to display my business license?
If I am buying a business that already has a business license, is a business license transferable?
What should I do if I sell or close my business?
Is there anything I need to do if my business location or activity changes during the year?
Do I need a separate business license for each location and for each type of business activity?
If I am working for someone who has a business license already, do I need a business license?
How do I register the name of my business?
How do I find out in which licensing jurisdiction my business is located?
Are there any other business taxes required in the City?
Every person engaged or intending to engage in any calling, business, occupation or profession in whole or in part within the City limits of Rock Hill, is required to pay an annual license fee for the privilege of doing business and obtain a business license. “Business” is defined as a calling, occupation, profession or activity engaged in with the object of gain, benefit or advantage, either directly or indirectly.
Does your entity (person, partnership, organization, or business):
- sell items to the public?
- claim office deductions or business expenses for a commercial or a residential location?
- use advertisements or business cards using an address based in the City of Rock Hill?
- have a business checking account?
- have an Employer Identification Number (EIN) from the IRS?
- have any other professional or occupational state license regulated by SC Labor, Licensing and Regulation (for example, architects, contractors, cosmetologists, engineers, physicians, therapists, etc.)?
- operate, manage or have control of the entity?
- transport passengers?
- receive compensation as an independent contractor and/or a form 1099 for work?
- own and/or lease property to other businesses or individuals?
- occupy a commercial space used for an office?
- have a physical location outside of the City of Rock Hill and provide services within the City limits of Rock Hill?
- have a physical location outside of the City of Rock Hill and perform work on or provide services to a construction project within the City limits?
If you answered YES to any item listed above, then a business license is required. The City of Rock Hill requires all businesses operating within the City limits, to obtain a business license and to pay a business license fee. This requirement ensures that businesses operating in the City of Rock Hill comply with local and state regulations.
If you answered NO to all items listed above, then a business license is not required.
Tax-exempt organizations may be exempt from requiring a license. Please provide proof of exemption.
Click here for a printable version of this list.
A business license is an excise tax levied on the privilege of doing business in a particular jurisdiction. It is a method of requiring a business or occupation to contribute its share in support of the government and to regulate business. It is not a sales or income tax, although it is measured by gross income.
The business license fee is one of the sources of revenue for the general fund. The amount collected in business licenses supports police, fire and all departments except Utilities. Along with permit and sanitation fees, it helps offset the difference between what is collected in property taxes and the cost to fund general government functions, such as public safety, court, finance, human resources, and parks, recreation and tourism. In short, the business license fee plays an important role in providing a CALEA-accredited police department, Class 1 ISO fire department and many other amenities that make Rock Hill a great place to do business. Additionally, the City conducts a cost-to-serve analysis each year to ensure business license rates are competitive compared to 24 other cities in South Carolina.
Having businesses obtain a business license provides several important benefits to the business community and the community as a whole. Business licenses protect the community by helping ensure that businesses are legitimate and operating in compliance with all City codes. It allows the City to be attuned to the local economy and understand the needs of the business community.
Any time a person or business is:
- physically located in or
- conducts business within the City limits of Rock Hill,
a business license is required. A business license is required even if no income has been generated when your business is physically located inside the City, unless your business is closed and you have submitted a closing business form.
The business license fee is determined by several factors, including: (1)where the business is located – inside/outside City limits, (2) the type of business being conducted based on Rate Class 1 - 8, and (3) the business’ gross receipts/income.
New businesses pay license fees on projected gross income from the start of business date through December 31st of that year. State law mandates that fees be paid on gross income without deductions for expense incurred for costs such as rents, salaries, cost of goods and other operational expenses.
Existing businesses must renew their business license annually. Renewal fees are based on the previous year’s gross income reported to the Internal Revenue Service. Businesses located outside the City limits of Rock Hill must report gross income exclusively for business conducted inside the City limits only.
“Gross income” means the total income of a business, received or accrued, for one calendar year collected or to be collected from business done within the City, subtracting income from business done wholly outside of the City on which a license tax is paid to some other city or a county. Gross income is defined by ordinance to mean the total received from the business operation without deductions of goods, overhead or salaries. It should conform to the gross figure reported on the business federal income tax return defined by the IRS Code Section 61(a). See the sample IRS tax forms to see which line item to report from your tax return.
- Gross income for brokers or agents means gross commissions received or retained, unless otherwise specified. Gross income for insurance companies means gross premiums collected.
- Gross income for business license tax purposes shall not include taxes collected for a governmental entity, escrow funds, or funds which are the property of a third party. The value of bartered goods or trade-in merchandise shall be included in gross income.
The gross income for business license purposes may be verified by inspection of returns and reports filed with the Internal Revenue Service, the South Carolina Department of Revenue, the South Carolina Insurance Commission, or other government agency.
Contractors based outside the city limits of Rock Hill may obtain a license per job and will need to provide a copy of their contract for the job along with the business license application.
New businesses should estimate their probable gross income.
Yes, business licenses expire December 31st of each year. You will have until April 30th to renew your license the following year to avoid a 5% late fee per month after the due date. Some businesses in Rate Class 8 may have a different due date. Renewals submitted on time by April 30th are eligible for a 10% discount.
Non-resident businesses must renew their license prior to conducting business in the new calendar year. If you do not intend to conduct business in the City limits, please indicate this on your renewal form.
If your business is closed, you may indicate this on your renewal form by writing "CLOSED" and the date the business closed. Please sign and date the form to allow us to close your business license account in our system.
Yes, some businesses are exempt from business license fees, however the business or organization must still apply using our online services in order to obtain a compliance certificate. Please contact the Business License office at 803-325-5590 for more information about exemptions.
Yes, the license should be displayed in a conspicuous place in the business establishment. A transient or non-resident business should carry the license upon his person or in a vehicle used in the business readily available for inspection by any authorized agent of the City. For companies with multiple vehicles, like contractors, it is recommended that each vehicle contain a copy of the license.
No, the current ordinance (Section 11-39) states that business licenses are not transferable, and a transfer of ownership is considered a termination of the old business and the establishment of a new business requiring a new business license, based on the income of the old business.
Note that utility accounts are also not transferable. A new utility account and deposit will be required for the new business.
You should notify the business license office in writing of the date that your business closed or was sold to another business or individual. Include the name of your business, physical location of your business, date sold or closed and the business license account number located on your printed license. Your written notification should be signed and dated.
If your business moves to another location or the activity of your business changes, you should notify the Open for Business Program immediately. A change in business activity may need to comply with building code or zoning code regulations.
The current ordinance (Section 11-39) requires that a change of address must be reported to license official within ten (10) days after the business moves to its new location. The license will then be valid at the new address after notifying the license official in writing and complying with zoning and building codes and approval of other departments as determined by the license official. Without this written notification, the existing business license is terminated, the business will be deemed as operating without a business license, and subject the licensee to prosecution.
Yes, a separate license is required for each place of business and for each classification. The current ordinance states that if the gross income cannot be separate for classifications at one location, the license fee shall be computed on the combined gross income for the classification requiring the highest rate.
If you are not on that company’s payroll with taxes deducted out of your paycheck and you receive a 1099 form instead, then you are considered self-employed and a business license is required.
The City Of Rock Hill does not register names of any businesses, but we can assist with determining whether or not anyone is presently using your potential business name within the City of Rock Hill. You may also contact the Secretary of State office to verify if anyone has incorporated the name you would like to use and inquire about the laws governing this issue.
You can use our online Map Search to find your jurisdiction. On the left side of the screen, enter the address and click "Zoom to Location". The location information will be shown on the left side of the screen. The jurisdiction should be listed below the address. If your business is inside City limits, you should see "City of Rock Hill. (INSIDE City limits)".
Yes, the City has a 2% Hospitality Tax that is required for businesses selling food and beverages prepared or modified for on-premises consumption. The tax is due on the 20th of each month. You can view more information about the Hospitality Tax in the municipal ordinance.
The City also has a 3% Accommodations Tax that is required for hotels, motels and other businesses providing accommodations to transients for consideration. This tax is also due on the 20th of each month. Visit Business Tax Forms for tax reporting forms. You can also view more information about the Accommodations Tax in the municipal ordinance.
Resources for starting a business
Open for Business Program – www.cityofrockhill.com/openforbusiness
Small Business Administration - www.sba.gov
State of South Carolina - www.SC.gov/business
SC Dept. of Revenue – www.scbos.sc.gov or www.sctax.org
SC Secretary of State - www.scsos.com