Do you need a license to sell soap? The short answer is no. The long answer is still no, but there are vital steps you need to take in order to avoid penalties and operate a legal soap-selling business. Many of us dream of starting our own business.
Etsy doesn't require sellers to have a business license.
Federally, there are no permits required because soap is specifically not a drug or a cosmetic, so the requirements for drugs or cosmetics do not apply at the federal level. You only have to label the ingredients.
Whether you're selling homemade soap and body products at craft fairs or your Etsy shop, you need to protect your business. For example, there's always a chance that someone could be allergic to fragrances or oils that you used. Suddenly, you could be held liable for a bodily injury claim.
No, Etsy does not require a business license to start an Etsy shop. There's no two ways about it: Etsy has become one of the premier online craft markets in the world. If you're launching your own handmade items and crafts business, Etsy is the place to be.
Typically, Etsy sellers tend to opt for sole proprietorships, but you could also consider forming an LLC or a partnership. Each format comes with its own set of obligations, so make sure you research and understand the implications before making a decision.
A tax ID is not a requirement to sell on Etsy when you register your business as a sole proprietorship. In this case, you will report taxes on your personal tax returns. However, if your business is a corporate entity or an LLC, you'll need an EIN (Employer identification number).
Handmade soap and bath products are a great example of an easy-to-make product that can be sold on Etsy. These items are also something that people will buy as gifts for others, so it's good to have options in this category when you're browsing through the site.
Neither the product nor its ingredients need approval by FDA before they go on the market, except for any color additives it contains. It is your responsibility to make sure your product is safe for consumers when it is used as intended, and to make sure it is properly labeled.
The following types of items are prohibited or restricted on Etsy: Alcohol, Tobacco, Drugs, Drug Paraphernalia, Medical Drugs and Devices, and Items making Medical Claims. Animal Products and Human Body Parts and Fluids. Dangerous Items: Hazardous Materials, Recalled Items, and Weapons.
There are no specific regulations regarding soap; however, any household product that meets the definition of a hazardous substance under the FHSA must bear cautionary labeling warning of the principal hazard(s) associated with the product and enabling the consumer to use and store the product safely about the ...
Community connection: Handmade soaps can be a hit at local markets and events, helping you build a strong community presence and brand loyalty. Online sales potential: Soap is easy to package and ship, making it an excellent product for online sales and for expanding your reach beyond local customers.
Lotions, soaps, and other cleansers may be regulated as cosmetics or as other product categories, depending on how they are intended to be used.
You don't need FDA approval to sell soap if it meets the regulatory definition of soap and is marketed solely for cleansing. If you market your product as moisturizing or you make any therapeutic claims, it may be classified as a cosmetic or drug, which requires following different regulations.
Selling food or other edible items is generally allowed on Etsy, but there are a number of government regulations that dictate who can make, package, and sell food. Check out our Seller Handbook for more specific information about making, selling, and shipping food items.
Pure cleansing soaps don't need FDA approval. However, if you market your soaps as moisturizing or having other benefits, it becomes a cosmetic product requiring FDA approval.
If you plan to manufacture and sell handcrafted soap & cosmetics to the public, you need to have both general & product liability policy in place to protect you, your business and your personal assets.
The ingredients (except certain colors) and labeling of cosmetics, such as many perfumes, makeup, moisturizers, shampoos, hair dyes, face and body cleansers, and shaving preparations do not require FDA approval.
In order to provide the service, Etsy charges fees for each sale made by the person who lists their items for sale. The site charges a fee to publish a listing to an online store created by the seller and a transaction fee that's based on the cost of the item and shipping.
If your total net income from self-employment, including Etsy sales, is $400 or more, you must pay self-employment tax, which includes Social Security and Medicare taxes. Even if you don't receive a 1099-K form, you're still required to report all your income from sales.
Etsy's seller policies do not require you to have a business license to sell on their platform. However, the inquiry doesn't end there. A seller of goods on Etsy may need a license or permit from municipal, county, state, or federal agencies regulating businesses. Your Etsy shop is either a business or a hobby.
Want to open your own Etsy shop? Create your shop today! Full disclosure: Tons of successful Etsy sellers run their shops without a limited liability company (LLC). In fact, most businesses on Etsy start (and thrive!) as sole proprietorships—the default business structure when you operate independently.