Philadelphia Commercial Activity License
Commercial Activity License…What is this? Who needs this? Why do we need this?
What is the Philadelphia Commercial Activity License?
A Commercial Activity License is required to conduct business within the city of Philadelphia. It is a license that links a business owner’s Business Income and Receipts tax and either Social Security Number or Federal Employer Identification Number (EIN) to their business activity. The Commercial Activity Licenses is issued by the Philadelphia Department of Licenses and Inspections (L&I). Once the license is issued, it does not expire. The Commercial Activity License can also serve as the foundation to register for more Philadelphia licenses. For example, a property owner must first apply for a Commercial Activity License before applying for the Philadelphia Rental License.
Who is required to have a Philadelphia Commercial Activity License?
In Philadelphia, any person on legal entity doing business within the city is required to have this license. Even if the business is not located in Philadelphia, but has business in the city then they are required to have the Commercial Activity License. In addition, the business owner is also required to register for the Business Income and Receipts Tax (BIRT) through the Philadelphia Tax Center. Once the Business Income and Receipts Tax (BIRT) is registered for, the business owner must file an annual tax return to the city of Philadelphia Revenue Department. The purpose of the Commercial Activity License is to link all of the businesses and legal entities registered to a business owners BIRT.
How is a Commercial Activity License Different from an Activity License Number?
There are special circumstances where a business is not required to have a Commercial Activity License. An Activity License Number is required for certain types of non-commercial activity in Philadelphia. The Activity License Number is issued by the Philadelphia Department of Licenses and Inspections. Non-commercial activities that would qualify for a Activity License Number include non-profits, a residential or commercial vacant property license, and an owner occupied rental building with us to three rented units. Instead of a Business Income and Receipts Tax (BIRT) the person or legal entity applying must register for a Philadelphia Tax Identification Number (PHTIN) through the Philadelphia Tax Center. However, similarly to the Commercial Activity License, the Activity License Number does not need to be renewed.
For more information on Commercial Activity Licenses or other types of Philadelphia Licenses please contact us at 215-740-6038 or Info@PhillyRentalLicense.com.
