UK Fact-File Part 1: UK Business Formation for Individuals

1.4 UK Individual Business Licensing

Licensing of individual business activity

Certain types of business require their owner to obtain a licence in order to operate legally; mainly operations relating to the sale of alcohol and tobacco and gambling operations (eg casino or bookmaker). However, other forms of licence are required for individuals operating in certain sectors (for example driving instructors). The local authority governing the area in which a business is to be located issues most of these licences. Licences to drive commercial or public vehicles are issued by the Driver Licensing Agency (DVLA).

For public houses, clubs or restaurants, two types of licence are required under the Licensing Act 2003, primarily to cover the sale of alcohol. A premises licence covers the building where the business is to be located and ensures that all health and safety and fire regulations are complied with in full. Secondly, a personal licence is required. This empowers the individual(s) who own and run the business to do so legally.

Serious responsibilities go hand-in-hand with running licensed premises and breaches of the law can result in the premises being closed down and heavy fines imposed on the owners. The purpose of these licences is the prevention of crime and disorder and to ensure the safety of the public.

Applications for both types of licence should be made through the local authority in the area where the business is to be located. Forms can be obtained from the local authority office or downloaded from the website of the Department for Culture, Media & Sport. A personal licence lasts initially for 10 years and can be renewed for further periods of ten years, subject to the authorities (police, local authority) being satisfied as to the suitability of an individual to continue to hold a personal licence.

Accredited qualifications relating to the industry sector (eg public house management) must usually be obtained beforehand, otherwise a licence may not be granted. Checks for criminal convictions are also made. Police can object to an individual being granted a personal licence and can have this licence revoked if they have serious concerns. Similarly, the police can have a premises licence revoked and the business shut down for breaches of the licensing laws.

Licenses can be required for certain other types of businesses; these include (but are not restricted to):

• Child care;
• Credit and financial services;
• Dog breeding;
• Ear piercing;
• Gambling (bookmaker, casino);
• Goods haulage (HGV);
• Import and export;
• Pet shop;
• Private coach operator;
• Security guard;
• Sports coach (eg football);
• Taxi driver

In most cases, the first point of contact would normally be the local authority offices in the area where the business is to be located or the trade association of the sector concerned.

It is illegal to trade in any of the above professions or sectors without first acquiring the proper licence. In addition to the licence requirements, many activities now require that a Criminal Records Bureau (CRB) check be carried out, especially where a person is to be working with children or vulnerable adults. The CRB check is processed by the police, though it can be requested by certain approved bodies in respect of a potential new employee.

Information about the types of licence required for various trades and businesses is available on the Business Link website. For details of special licences required for driving commercial or public vehicles, contact the Driver Licensing Agency (www.dft.gov.uk/dvla/). For details of special licences required for the import and export of goods, visit the BSI website (Department for Business Innovation & Skills) at www.berr.gov.uk. A licence to become a bookmaker can be obtained from the Gambling Commission (www.gamblingcommission.gov.uk).

The cost of business licensing, initially and ongoing

The fee for applying for a personal licence to run licensed premises such as a public house, nightclub or restaurant was GBP37 at the time of writing. Fees for the premises licence are based on the rateable value of the premises and vary from GBP100 to several hundred pounds. Special certificates may also be required for one-off events.

Fees for other licences vary. For an HGV licence, the costs involved include the cost of HGV driver training and can amount to as much as GBP1,000 for training and the granting of a licence.

A bookmaker must renew their licence every year at a cost of around GBP470.

Costs of other licences vary considerably.

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