How Old Do You Have to Be to Dropship? (Read This First)

You're probably wondering how old you have to be to start dropshipping.

Well, kids as young as 15 have started dropshipping businesses.

However, minors will need some level of parental consent to get started.

That said, this article will guide you through launching your dropshipping store even if you're under 18.

Let's get started!

Disclaimer: The information provided in this article is intended for general guidance only and does not constitute legal advice. Requirements and obligations may vary based on your specific jurisdiction and circumstances.

How old do you have to be to dropship?

Generally, you have to be at least 18 years old to start dropshipping by yourself.

This is the age at which you can legally enter into contracts, such as opening a business bank account or signing up for payment processors like PayPal.

However, you can also start dropshipping at a younger age.

If you're 13 years or older, you can already start a dropshipping store, but you will need a parental guardian who can set up some parts of the business in their name until you reach 18.

Can I dropship at 16?

If you're 16 and want to start dropshipping, you can. However, you'll need an adult by your side who is willing to help you with legal aspects such as signing up for payment processors (such as Stripe).

Having a business bank account is also important. However, banks often require you to be 18 to open one on your own. So, this is another thing you'll need help with.

For example, you can open a Stripe account from 13 years old, as long as you have a legal guardian who assumes the role of owner of your account:

You may also be wondering if there are any extra conditions in terms of starting a dropshipping business whether you are 13 or 16 years old.

Well, during our research, we found that there are no specific extra conditions for 13-year-olds compared to 16-year-olds, as both age groups are considered minors.

What do I need to know about dropshipping as a minor?

If you are young and want to start dropshipping, you'll need your parents' okay and help.

Here are a few things you should know:

You'll likely need help from your parents

You need your parents or legal guardians to agree and help with your dropshipping store because there are rules about who can start a business, sign contracts, and use banking services.

For example, if you want to use Shopify to create your dropshipping store, their legal terms state that you must be 18 years or older to operate a store:

Therefore, you'll need your parents to sign up for your Shopify account under their name.

Keep in mind about the legal restrictions

If you're dropshipping, you will eventually need to set up a company and comply with the relevant laws and regulations of the state/country where you live.

This may include:

1. Business registration in your area.
2. Sales tax collection and reporting.
3. Consumer protection laws regarding product descriptions, returns, and refunds.
4. Intellectual property laws if you're reselling branded products.
5. Privacy laws for handling customer data.

Let's take the US as an example, where setting up a company, like an LLC, for your dropshipping store is possible.

However, in most states, you must be at least 18 years old to legally form an LLC.

If you are under 18, you need a parent or guardian to form the LLC on your behalf.

They would be listed as the organizer and could hold the position until you reach the legal age.

Which US banks allow teens to open an account?

Opening a bank account is an important step towards starting a dropshipping business.

Luckily, some banks in the United States offer specialized accounts designed for teenagers, often with relaxed requirements and fees:

1. Capital One MONEY Teen Checking Account
   • Minimum age: 8 years old
   • No minimum deposit or balance requirements
   • No monthly fees
   • Requires a parent or guardian as a joint account holder
2. Chase High School Checking Account
   • Minimum age: 13 years old
   • No monthly service fee for students aged 13-17
   • Requires a parent or guardian as a co-owner of the account
3. Wells Fargo Clear Access Banking
   • Minimum age: 13 years old
   • No overdraft or non-sufficient funds (NSF) fees
   • Requires an adult co-owner on the account

What is the minimum age for using & accepting PayPal?

PayPal's minimum age requirement for using and accepting payments through their service is 18 years old.

If you open a PayPal account under 18, you risk having your account closed if PayPal discovers that you are under the legal age.

Which ecommerce platforms allow you to start a store under 18?

There are several ecommerce platforms that allow you to start an online store even if you are under 18 years old.

Here are some options:

1. Wix. Wix is a website builder that also offers ecommerce capabilities. What's cool about this platform is that you can use it if you are above 13 years old or 16 years old if you reside within a European Union country. (But keep in mind that Wix might not be the best option long-term for dropshipping)
2. Squarespace. Squarespace is another popular website builder with ecommerce features. You can use it if you're 16 or older.
3. Big Cartel. Big Cartel is an ecommerce platform specifically designed for artists and creators. If you are between 13 and 17, you can use the platform as long as you have evidence of your parent's consent.

Do you have to pay taxes on a dropshipping store if you’re under 18?

Even if you're under 18, running a dropshipping store means you have to pay taxes.

Your age doesn't change this fact.

Again, your parents can guide you on how to handle your taxes correctly.

Do you need a business license to dropship?

In general, you can start dropshipping without a business license, but you'll eventually need one if your store starts getting consistent sales.

Many payment processors, such as PayPal, Stripe, and major credit card companies, also have strict policies that require you to provide documentation proving you are legally registered and licensed to operate.

That said, the requirements for business licenses for dropshipping vary depending on your country and sometimes even the state or region within a country.

Here is an overview of some general guidelines:

1. United States. Requirements vary by state, but generally, you'll need a business license, sales tax permit, and an Employer Identification Number (EIN) if you have employees. (More info about dropshipping in the US here)
2. United Kingdom. You'll need to register your business with HM Revenue and Customs (HMRC) and potentially obtain a business license depending on the nature of your business. (More info about dropshipping in the UK here)
3. Canada. You may need to register your business with the provincial government and obtain a business license. Requirements vary by province. (More info about dropshipping in Canada here)
4. Australia. You'll need to register your business with the Australian Securities and Investments Commission (ASIC) and obtain an Australian Business Number (ABN). (More info about dropshipping in Australia here)
5. European Union. Requirements vary by country, but generally, you'll need to register your business and obtain a tax ID number. (More info about dropshipping in Europe here)

Where to register your business in the US?

If you are based in the US, there are mainly two states that offer advantages for registering an LLC; the two most common ones are Nevada and Wyoming.

There are a few key reasons why Nevada and Wyoming are popular states for registering Limited Liability Companies (LLCs), even for businesses based in other states:

1. Asset Protection. Nevada and Wyoming offer strong asset protection laws that can help shield the personal assets of LLC owners from business liabilities and lawsuits.
2. Privacy. These states allow for more anonymity and privacy for LLC owners, as they do not require the disclosure of members'/managers' personal information in public records.
3. Tax advantages. Neither Nevada nor Wyoming has a corporate income tax or franchise tax on LLCs, which can result in significant tax savings for businesses.
4. Flexible structures. These states offer flexibility in structuring LLCs, allowing for different management styles and ownership structures.

However, if you're a teenager, you would have to question yourself whether it is worth the effort register an LLC in a different state from where you reside.

For a small business with minimal risk and assets, the benefits of registering an out-of-state LLC usually do not outweigh the additional costs and complexity.

So, if you're under 18, registering an LLC in your home state may be a more practical and cost-effective option initially.

However, as the business grows and accumulates more assets or faces higher liability risks, registering an LLC in a state like Nevada or Wyoming could become more advantageous.

Again, always consult with a CPA for professional advice. For example, you can check out NCH:

It's a company that has established its authority with more than 10,000 Trustpilot reviews in helping business owners form companies.

Summary

Before we go, we've created a quick summary of this article for you, so you can easily remember it:

• You can start a dropshipping business as young as 13, but you will need parental consent and assistance.
• Shopify requires you to be 18 or older to operate a store, so your parents must sign up for you.
• To form an LLC in the US, you generally need to be 18; if you are younger, a parent or guardian can form it on your behalf.
• Some US banks offer checking accounts for teenagers with a parent or guardian as a joint account holder.
• PayPal requires users to be 18 or older to use their services.
• Wix, Squarespace, and Big Cartel are ecommerce platforms that allow you to sign up under 18 with parental consent.
• Eventually, you will need a business license for dropshipping, depending on your country or state.
• Running a dropshipping store means you have to pay taxes, regardless of your age, with guidance from your parents.

Conclusion

All in all, starting a dropshipping store is possible from 13 years old, as long as you have consent and help from your parents or legal guardians.

Remember, success in ecommerce comes with learning and adapting.

So, no matter your age, you can make it big in the online selling world if you're ready to work hard and keep growing!

Want to learn more about dropshipping?

Ready to move your dropshipping store to the next level? Check out the articles below:

• How to Start Dropshipping in 2024: Your 7-Step Guide
• 18 Things to Know Before Starting a Dropshipping Store
• Can You Start Dropshipping With No Money? (Know This First)

Plus, don’t forget to check out our in-depth guide on how to start dropshipping here!