With technological advancements in printing and the Internet, it’s easier than ever to get into a custom tee-shirt printing business. However, to do this kind of hustle legally, it’s important to know what licenses and fees are associated with starting your own custom shirt business. 

Yes, you can sell custom shirts online without a business license as long as you have a tax ID number to claim your taxes to. Tax ID number can simply be your SSN or your countries tax equivalent. However, custom shirts sold at a physical storefront will need a local business license.

Selling custom shirts can be a good way to make extra money as a side business, and it can even blossom into a full-time profession. It’s important to make sure that you’re doing things legally in the process of setting up your tee-shirt business though. Read on to learn more about the legal way to sell custom shirts without a license. 

Do You Need a License to Sell Custom Shirts?

Whether you need a business license to sell custom shirts depends on how you’re planning to sell them. For those merchants who only intend to sell custom shirts through an online website like Teespring, RedBubble, Merch by Amazon, or Etsy, a business license isn’t necessary. However, if you plan to sell shirts in a physical storefront, you’ll need a local business license to conduct business legally. 

What Licenses Are Needed to Sell Custom Shirts?

If you sell custom shirts online, you don’t need any specific business license. If you’re selling shirts in a store, you’ll need to purchase a business license to cover the cost of doing business locally. 

Another instance where you’ll need a license to sell custom shirts is if you plan to sell in an open market format, such as at a vendor’s stall. In this case, location-specific licenses are issued to vendors to give them the right to sell their wares at a specific market. 

Can You Sell Shirts Online Without a License?

Yes, you can sell custom shirts online in formats like print on-demand without a business license. Websites like Teespring, RedBubble, and Merch by Amazon, do not require a business or business license to start selling.

However, it’s good to keep in mind that the profit you make from these websites will still need to be added to your income when tax time comes around.

You only need to add this to your local taxes. For example, if you are a seller from the United States, you will add this to your US Taxes. However, if you’re a seller from the UK, you will only add this income to your UK Tax return. You are not required to pay tax to others countries when selling print on-demand.

Do You Need a License to Sell Trademarked Shirts?

Yes, you’ll need a license to sell shirts that have been copyrighted and trademarked by another person or entity. If an image is protected by copyright, you’ll need to purchase a license to use the image copyright for commercial reproduction. This is the only way to reproduce and sell the image legally.

Depending on the image owner, you may have to pay royalties or other fees associated with the copyright to the person who owns the copyright.

It’s recommended to either make your custom shirt designs from scratch on Photoshop or Illustrator, or use copyright-free shirt templates from a websites like Placeit.

What Designs Should You Avoid in Custom Shirts for Copyright?

To avoid having to buy a copyright license for your custom shirt designs, you’ll need to know which images should be avoided in your tee-shirt designs. 

While it might be tempting to use images from popular culture to center your shirt designs around, this is legally dangerous ground. If you use a copyrighted image without the permission of the original creator, you leave yourself open to lawsuit for copyright infringement. 

Here are some of the images you should avoid in your custom shirts if you want to avoid being sued for copyright infringement (Source: SpreadShop): 

• Logos: Any logos used in sports teams, school associations, TV shows, or other popular media should be avoided. These images are usually copyrighted and many organizations, such as the NFL, are strict about regulating copyright use for them.
  
• Trademarked characters: Famous fictional characters like Mickey Mouse or Popeye cannot be used without infringing their copyright. This also goes for photographs or images of famous celebrities.
  
• Trademarked images: While you might consider viral content from social media to be fair game for custom shirt designs, you’d be surprised at how many of these famous images, such as the Internet meme the Nyan Cat, are actually claimed for copyright by their original creators. (Source: DenGen Chronicles)
  

If you don’t have the copyright permission to reproduce a trademarked image, you should avoid using that image on your custom shirt designs. Otherwise, the creator of the trademark could end up suing you for copyright infringement. 

What Happens If You Use a Copyrighted Image Without Permission?

Even though it’s technically illegal to use a copyrighted or trademarked image without the creator’s permission, chances are you’ve seen plenty of pop culture images on custom shirts online. The reality is that there are so many independent vendors violating copyright law that companies find it difficult to police them. 

However, this isn’t a good excuse for ignoring copyright permissions when you’re setting up your custom shirt shop. Your shirts may never be claimed for copyright violation, but if they are you could end up getting sued or your online shop could be shut down. 

What Images Are in the Public Domain for Shirt Design?

To avoid being sued for copyright violations, you should restrict the designs in your custom shirts to images that are either original artworks or images in the public domain. Images in the public domain consist of the following: 

• Images with an expired copyright: Even though creators can trademark an image to protect copyright against it, these copyright permissions only last for a certain amount of time. After this statute of limitations passes, the copyright no longer applies and the image can be legally used by anyone.
  
• Images under fair use: Another way that people can get around traditional copyright laws is to claim ownership of the imagery under fair use. However, fair use doesn’t typically cover images that are used commercially (such as those reproduced on shirts). (Source: Prodigi)
  

If you’re worried about images on your custom shirts being claimed for copyright infringement, the best option is to only print shirts with original content and artwork. Using design template websites like Placeit.net can help you come up with original designs that are compelling without depending on copyrighted material.

If the artwork is your own, you’ll never have to worry about being sued for violating someone else’s trademark. 

Keep Things Legal in Your Custom Shirt Business

Even though you won’t need a business license in many cases if you’re trying to get a digital custom shirt shop started, you’ll still need to be aware of the copyright laws surrounding the images you want to reproduce. It’s also smart to check into your financial obligations as a small business owner. That way, you won’t get caught by surprise at tax time.