How To Start a Business in Texas

From getting a sales permit tax and business-specific licenses to filing with the secretary of state, starting a business in Texas includes multiple processes. If not completed with due diligence, you may incur heavy fines from the state. To help entity owners understand how to start a business in Texas, we’ve come up with a quick guide that covers all you need to know about the procedure. We’ll also show how Harbor Compliance can simplify the processes and help you save time.

Seven Steps To Open a Business in Texas

The Texas Economic Development & Tourism outlines seven steps that entrepreneurs can follow to form a new entity. We’ll discuss each step below:

1. Prepare a business plan
2. Pick a location
3. Raise/get capital
4. Select a business structure
5. Fulfill tax liabilities
6. Complete employer requirements
7. Obtain the necessary business licenses/permits

1. Prepare a Business Plan

Before starting a business, you need to make a comprehensive framework known as a “business plan.” This document should include key elements, such as the company’s value proposition, financial projections, market analysis, and purpose.

2. Pick a Location

The next step is to decide on the location from which you want to operate your business. Factors like workforce availability, supply chain requirements, and customer reach will help you choose an ideal location for your organization.

3. Raise/Get capital

After setting up the business plan and location, you will need appropriate funds depending on the type of organization. You have many options to source capital, such as personal savings and raise investments from angel investors or venture capital firms.

4. Select a Business Structure

Deciding on a structure for your company is one of the essential steps. It is important to note that this choice will impact various aspects, including tax obligations, liabilities, and business objectives.
The types of business structures to consider are as follows:

• Sole proprietorship
• Partnership
• Limited liability company (LLC)
• Corporation
• Nonprofit organization

If you choose a sole proprietorship or partnership, you must file and register a fictitious (assumed) business name with your local county. Organizations can register their business using the secretary of state website, which is available 24/7.

5. Fulfill Tax Liabilities

To operate a business in Texas, you have to apply for a sales and use tax permit. This applies if your entity:

• Sells tangible personal property within Texas
• Rents or leases tangible property within Texas
• Provides taxable services within Texas

Additionally, entities that remotely sell services in Texas or operate as marketplace sellers/providers within the state are also required to obtain a sales and use tax permit. The state’s marketplace seller tax website covers this in detail.

Notably, obtaining this permit is free. Additionally, your business has to file and pay the respective franchise tax via the Texas Comptroller of Public Accounts (CPA). If you have an online business, you should visit the CPA’s website to determine whether you are eligible for a sales and use permit in addition to the franchise tax.

6. Complete Employer Requirements

If your business is going to employ workers, you’ll need to determine your federal and state employer requirements. Texas-based organizations can visit the Texas Workforce Commission to learn about the laws and steps for registering an Unemployment Tax Account.

7. Obtain Business Licenses/Permits

In addition to registering a business in Texas, you must comply with the state’s regulatory requirements. While Texas doesn’t require a statewide general license, businesses must obtain permits and licenses for more than 300 specific industries, including agriculture, retail, and others.

Various agencies handle the issuance of licenses and permits to these industries, which can make the process time-consuming for many businesses.

According to the state’s Licensing and Permits Guide, it’s advisable to consult a professional before starting your business in Texas. Fortunately, Harbor Compliance—a trusted service provider—can simplify and guide you through the entire process, from business registration to obtaining the necessary licenses and permits, ensuring compliance with Texas regulations.

Start a Business in Texas With Harbor Compliance’s Assistance

Starting a business can be overwhelming, especially when it comes to navigating the complex web of legal and regulatory requirements. From filing necessary paperwork and registering a fictitious business name to obtaining local licenses and ensuring compliance across various cities and counties, staying on top of these details demands time, knowledge, and careful attention.

At Harbor Compliance, we understand the complexity of this process and offer comprehensive services that help simplify it—from LLC formation and incorporation to obtaining an EIN, registering a DBA, and appointing a registered agent. We also help with payroll tax registration and more, ensuring that every detail is taken care of so you can focus on growing your business.

Our team of specialists can save you hours of research and ensure your business is set up correctly. With our services, you can avoid the high costs of hiring an attorney while still receiving reliable, expert guidance. Here’s how we simplify the process for you:

• Registered agent—We handle the receipt of legal and government notices, ensuring timely responses across multiple states.
• Business licensing—We help you obtain the proper licenses (both general and industry-specific ones) to keep your business in compliance and avoid costly fines and delays.
• Annual reports—We take care of filing your annual reports on time to maintain good standing with the state.
• Software Suite—It automates essential tasks like entity management, license tracking, tax compliance, and record-keeping. This gives you full visibility into your business’s compliance status and simplifies your ongoing operations so you can focus on growing your business with peace of mind.

How To Order Harbor Compliance’s Comprehensive Solutions

You can start by ordering our formation services:

1. Visit our LLC Formation or Incorporation page.
2. Select Order Online.
3. Provide your contact information.
4. Submit your request, and our team will guide you through the next steps.

To explore our Software Suite, schedule a personalized demo by following these steps:

1. Visit our Software Suite page.
2. Select Schedule a Demo.
3. Provide your contact and business details.
4. Submit your request, and our team will contact you with further information.

If you need more help starting your business in Texas, visit our Business Solutions page to order specific services, such as Registered Agent, Managed Annual License, Payroll Tax registration, and more.

Additional Harbor Compliance Services

Our service portfolio covers more than just business registration. Check out the table below to discover the different ways we can benefit your entity.

Texas Business Registration FAQs

Below, you’ll find answers to a few questions regarding starting a business in Texas. To learn more, check out our Information Center.

Start Your Business the Easy Way—Rely on Harbor Compliance

Starting a business in Texas is a complex process, which consists of seven essential steps. It includes choosing a distinctive business name, filing the necessary formation documents with the state, and more. After completing the registration, your business must stay on top of ongoing compliance requirements to avoid penalties and maintain good standing.

Rather than navigating this process on your own, it’s advisable to partner with a professional service provider like Harbor Compliance—we can streamline your registration and ensure you meet Texas’ legal obligations.

To get started, you can visit our Business Solutions page to browse and order our comprehensive services. Explore our Software Suite to understand how our modules can help you manage your entity and keep it in good standing with Texas regulations. All you need to do is schedule a demo.

Additionally, you can use our FREE Harbor Compliance Score™ to assess your current compliance status and gain valuable insights into areas that might need improvement.

Want to learn more about starting a business throughout the U.S.? Check out the table below: