Title: Subcontractor license: trade and entity | Cercha

Description: Check NC subcontractor licensing by trade, contract role, and legal entity. Use official sources and compare Washington registration.

Canonical: https://cercha.pages.dev/guides/do-you-need-a-license-to-be-a-subcontractor/

# Do you need a license to be a subcontractor?

Residential construction roles

The answer depends on the work, jurisdiction, and contract role. North Carolina’s general-contractor threshold does not replace separate trade-license rules.

You are about to bid subcontract work and need to know which license applies. The word “subcontractor” alone does not tell you which license you need. In North Carolina, general contracting, electrical contracting, and plumbing or heating contracting have distinct statutory requirements. Check the work and arrangement before offering the package. [GC law](https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-1.html), [electrical law](https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-43.html), [plumbing and heating law](https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-21.html).

Ask the relevant board for a ruling on your company's work. Give it the scope, location, legal business name, and who hires whom.

## Separate the trade business from its workers

North Carolina's electrical statute requires an applicable license for engaging or offering to engage in electrical contracting. Its exceptions include work performed as a bona fide employee of a board licensee. That business licensing rule does not mean every crew member needs the same contractor license. [G.S. 87-43](https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-43.html), [G.S. 87-43.1](https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-43.1.html).

The plumbing, heating, and fire sprinkler provisions also distinguish contracting from work as a bona fide employee of a licensee. [G.S. 87-25](https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-25.html). If you plan to leave employment and contract through your own company, ask the board about that proposed business arrangement before quoting.

Write the name of the business that will bid, sign, and perform the agreement. North Carolina's GC board says its licenses belong to specific legal entities and are valid only for those entities' work. A qualifier's examination credential is separate from the company's license. [Board FAQ](https://www.nclbgc.org/faq-contractors/).

## Check separate trade licenses and exceptions

These North Carolina statutes regulate contracting in the listed trades. They include classifications and exceptions. An exception must fit the actual work and relationship. [Electrical provisions](https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-43.html), [plumbing and heating provisions](https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-21.html).

| Proposed contracting scope | Official starting point | Question to settle |
| --- | --- | --- |
| Electrical installation, alteration, maintenance, or repair | G.S. 87-43 and 87-43.1 | Which electrical classification covers the scope, and does a specific exception apply? |
| Plumbing | G.S. 87-21 and 87-25 | Which plumbing license and class cover the proposed system and building? |
| Heating or air-conditioning systems | G.S. 87-21 and 87-25 | Which heating group and license class cover the system? |
| Fire sprinkler contracting | G.S. 87-21 and 87-25 | Which sprinkler authorization covers the proposed work? |
| Fuel piping within the board's scope | G.S. 87-21 | Is the work covered by an existing license or a restricted fuel piping license? |

This table covers common house-building scopes, so check other work with the regulator. When a package combines tasks, describe every task to the regulator. Ask whether the package needs more than one license or approval. Keep a written record of the answer and the scope you supplied.

Do not use a GC license as a substitute for a required trade license. G.S. 87-21 expressly says a license under that article does not authorize another profession or trade requiring a state qualification license. [Read the licensing provisions](https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-21.html).

## Ask how the GC threshold applies to your contract

G.S. 87-1 defines covered general contracting where the undertaking costs $40,000 or more. The definition includes bidding, constructing, superintending, or managing on one's own behalf or for a party not licensed under the article. It also addresses labeled manufactured modular buildings and lists exceptions. [Read the full definition](https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-1.html).

Neither “my contract exceeds $40,000” nor “someone else is the GC” settles the question. Ask the board how the statute applies to who hires your company and what work it takes on. Do not assume all subs are exempt.

Before contacting the board, prepare these details:

1. Name the legal entity that proposes to bid and contract.
2. Describe the exact work, including any supervision or management.
3. Identify who hires that entity and its relevant license status.
4. State the total proposed undertaking and how the amount is calculated.
5. Identify the building type, project address, and any modular-building component.
6. Ask which license, classification, limitation, or exception applies.

Describe all the work, including extras. Ask what other information the board needs. Apply its answer only to the facts you supplied.

## Check scope, limitation, and entity

The NC GC board distinguishes classification, which covers work type, from limitation, which controls project value. Its published categories include Building and Residential, with different scope descriptions. Check both classification and limitation, even when the record says “licensed.” [Board classifications and limitations](https://www.nclbgc.org/classifications-and-limitations/).

Use the [license verification process](/guides/verify-contractor-license/) to check the signing entity. For NC general contracting, compare the scope with the [GC licensing rule](/guides/nc-general-contractor-license/).

Compare the proposal's entity name with the current record. Check the applicable scope and limitation. Ask the issuing board to explain an inactive status, a mismatch, or an uncertain classification. Save the check date and proposed scope with the record.

If you change the company's legal entity, ask the board what the new entity needs before bidding or contracting. Do not assume that a familiar owner or an existing qualifier carries the old company's authorization into the new one. [The GC board's entity guidance](https://www.nclbgc.org/faq-contractors/) explains that licenses are not transferable between entities.

## Other states use different systems

Washington requires construction contractor registration, with a bond or assignment of savings and general liability insurance. Its L&I guidance also identifies additional licensing requirements for certain trades. Registration and a trade license are separate questions there. [Washington L&I](https://www.lni.wa.gov/licensing-permits/contractors/register-as-a-contractor/).

Check the rules in the state where you plan to work. Before accepting work across a state line, identify the state regulator and local permitting office. Send them the scope details listed above. Ask what must be complete before bidding, contracting, and performing the work.

Check exam acceptance and permission to operate separately. North Carolina's GC board says it does not have full reciprocity with another state, although examination waiver arrangements exist. [Board FAQ](https://www.nclbgc.org/faq-contractors/). Ask the destination board what an existing credential satisfies and what application steps remain.

## Insurance and permits remain separate questions

North Carolina's GC board says insurance is not itself a GC licensing requirement, while individual projects and permits can impose insurance requirements. A license therefore does not establish coverage. [Board insurance FAQ](https://www.nclbgc.org/faq-contractors/).

Ask your licensed insurance agent about the planned work and crew arrangement. Ask the local permitting office who must apply for the relevant permits and inspections. Keep those answers beside the licensing record. Complete each check before sending the crew.

## Keep sensitive records private

Ask the board for a secure submission channel before sending sensitive application records. Share verification status with the site team. [FTC access guidance](https://www.ftc.gov/business-guidance/resources/protecting-personal-information-guide-business).

Use [the subcontracting contract-chain guide](/guides/what-is-subcontracting/) to map who buys each scope and who receives the handoff.

## Where Cercha fits

Cercha profiles can display credential badges and portfolios. The app's coverage disclosure directs readers to verify coverage with the employer or insurer. [Ask about the Cercha beta](/beta/) to explore the profile features, and use the issuing board to confirm licensing for your actual scope.

Published 2026.10.14. Updated 2026.10.14.

[More guides: Subcontractor basics](</guides/topics/subcontractor-basics/>)

## Related guides

- [How to verify a contractor license](</guides/verify-contractor-license/>)
- [What documents to collect from a subcontractor](</guides/documents-from-a-subcontractor/>)
- [Trade partner: what builders mean by it](</guides/trade-partner/>)

## Build your connections

[Ask about the Cercha beta](</beta/>)

## Sources

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1. N.C. Gen. Stat. § 87-1. https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-1.html

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2. N.C. Gen. Stat. § 87-43. https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-43.html

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3. N.C. Gen. Stat. § 87-21. https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-21.html

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4. N.C. Gen. Stat. § 87-43.1. https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-43.1.html

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5. N.C. Gen. Stat. § 87-25. https://www.ncleg.gov/EnactedLegislation/Statutes/HTML/BySection/Chapter_87/GS_87-25.html

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6. North Carolina Licensing Board for General Contractors. (n.d.). *FAQ for Contractors*. Retrieved October 14, 2026, from https://www.nclbgc.org/faq-contractors/

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7. North Carolina Licensing Board for General Contractors. (n.d.). *Classifications and limitations*. Retrieved October 14, 2026, from https://www.nclbgc.org/classifications-and-limitations/

<a id="source-8"></a>

8. Washington State Department of Labor & Industries. (n.d.). *Register as a Contractor*. Retrieved October 14, 2026, from https://www.lni.wa.gov/licensing-permits/contractors/register-as-a-contractor/

<a id="source-9"></a>

9. Federal Trade Commission. (n.d.). *Protecting Personal Information: A Guide for Business*. Retrieved October 14, 2026, from https://www.ftc.gov/business-guidance/resources/protecting-personal-information-guide-business