How to get a business license in California
Starting a business in California is exciting, but identifying the business licenses you need can be complex. LegalZoom, rated as the preferred online method to find your required business licenses,* offers a customized report with direct access to license applications and ongoing licensing alerts and management. Just $99/year.†
California—open for business
California isn't just called the Golden State for its sunny weather; it’s also renowned for its dynamic business and economic development opportunities, making it an ideal place to start your business. Whether you’re launching a tech startup in Silicon Valley or opening a quaint coffee shop in Los Angeles, obtaining the right federal, state, and local business licenses is important to ensure you're in compliance and set up for success. We'll walk you through the required licenses and the steps to get them, ensuring your business is legally sound and ready to operate.
Find and manage the business licenses you need
Ability to effortlessly manage your licenses by uploading, viewing, and sharing all from one place
Generally, a business license is a government document required by the federal, state, or local government that allows you to operate your business legally. These licenses and permits are essential for various business activities, ensuring you meet regulatory standards. They not only help protect your business from penalties and the risk of closure but also reassure customers that it's safe to do business with you.
For example, if you want to operate your business from home in California, you may need a home occupation permit. A restaurant might need a health department permit from the California Department of Public Health in addition to an alcohol and food service license—and may even want a music license to host shows. If you open a shop, you may need a California seller's permit and a sales tax license from the California Department of Tax and Fee Administration.
Do you need a business license in California?
Yes, California typically requires more licenses and permits than other states. On average, our business license customers need at least 7 licenses to operate legally, so be sure to check all necessary requirements for your business. Not having a seller’s permit, for instance, can lead to fines up to $5,000 and/or jail time. Whether your operation is a limited liability company (LLC) or a corporation, you'll need one or more California business licenses. The specifics depend on your location and business type. California does not issue a statewide business operating license, but nearly all businesses need a local business license at the city or county level and a seller’s permit. Additionally, certain business activities may require state or federal business licenses.
LegalZoom makes it easy to find the right California licenses, permits, and registrations so you can operate your business legally. Plus, you can effortlessly manage your ongoing licensing needs directly from your account by uploading, viewing, and sharing all from one place. This can help save you time on researching what local licenses you’ll need, so you can get your business up and running faster.
Types of business licenses
Local licenses
Local licenses are typically required for most businesses. These are issued by the city or county where your business operates. For example, a restaurant might need a health permit from the local health department. If your business changes the configuration of walls, pipes, wiring, roofs, major appliances, or any significant structural changes, you may also need a building permit.
California state licenses
While California does not have a blanket state-level business license, specific professions and industries may be regulated by the state. For instance, businesses that sell tangible goods, such as clothing, electronics, food and beverages, or construction materials, will need a California Seller’s Permit from the California Department of Tax and Fee Administration. Industries such as healthcare, construction, and alcohol sales require additional state-level permits. Examples include a Contractor’s License for builders and a Liquor License for establishments selling alcohol.
Federal licenses
Federal licenses are required for small businesses involved in activities regulated by the federal government. These include industries like broadcasting, alcohol, tobacco, firearms, and transportation. If your business falls into one of these categories, you’ll need to apply for the appropriate federal license. For example, a business involved in producing and selling alcoholic beverages must obtain permits from the Alcohol and Tobacco Tax and Trade Bureau (TTB).
How to get a business license in California in 5 steps
Establish your business
Begin by deciding on your business name and structure. Form your business entity—such as a corporation, LLC, or partnership, with the California Secretary of State. If you are not registering an entity or you plan to use multiple business names, then you might need to register your business name (also known as a DBA or “Doing Business As”) in the county where your business is located. If you haven't formed your business entity yet, we can help you get started forming your business in just a few minutes.
Obtain an EIN
An Employer Identification Number (EIN) from the IRS is necessary if you plan to hire employees or if your business structure requires it. This number acts as a tax ID for your business, facilitating the opening of business bank accounts and filing taxes. LegalZoom can help you get an EIN for your business if you plan to hire employees.
Apply for local licenses
Use LegalZoom’s business license service to save time and learn about the specific licenses and permits you need. This often includes a general business license or a business tax certificate. Each locality has its own forms, fees, and processes, so it’s crucial to follow the local guidelines closely.
Apply for state licenses
Identify and apply for any state-level licenses necessary for your business. This might include the Seller’s Permit or other specific occupational licenses or permits, depending on your industry.
Apply for federal licenses
If your business requires federal licensing, apply through the appropriate federal agency. For example, if you are involved in agriculture, you’ll need to apply through the licensing office of the U.S. Department of Agriculture (USDA). Other businesses that typically require federal licensing are:
• Alcohol and tobacco: Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF)
• Aviation: Federal Aviation Administration (FAA)
• Broadcasting: Federal Communications Commission (FCC)
• Firearms and ammunition: Bureau of Alcohol, Tobacco, Firearms, and Explosives (ATF)
• Mining and drilling: Bureau of Safety and Environmental Enforcement (BSEE)
LegalZoom’s business license report will identify any federal licensing requirements specific to your business, helping you get all the permits and licenses you need to meet all necessary federal regulations.
Display and compliance
Once you have obtained your general business license, prominently display it at your business location as required by law. Adhere to all local regulations, and ensure you stay compliant with any ongoing operational requirements.
Renewal and updates
Most business licenses need to be renewed annually. Failing to renew your licenses on time can result in penalties, fines, and interruptions in your business operations. Additionally, if there are significant changes to your business, such as a new address, change in ownership, or expanding the types of services you offer, you'll need to update your licenses accordingly.
With LegalZoom’s business license service, you don’t need to worry about missing renewal dates. We send timely alerts for upcoming expirations, helping you avoid the costly consequences of expired licenses. Our service helps ensure that your company stays compliant and that you can continue to focus on running your business smoothly.
Getting a California business license—the easy way
Navigating the complex landscape of business licenses and permits in California can be daunting, but LegalZoom makes the process straightforward. Our business license service helps ensure you have what you need to operate your business legally. Here’s how we can help:
Speed
Simplify the licensing process with access to all necessary applications. LegalZoom navigates over 75,000 jurisdictions for you, saving time and hassle, so you can focus on growing your California business.
Stay compliant effortlessly with our notification services. We provide updates on changes to your California licensing requirements and reminders for renewals, helping you avoid fines and disruptions.
Ready to simplify your licensing journey?
Starting a business in California comes with a unique set of challenges and opportunities. Securing the necessary licenses lays a solid foundation for your business to thrive. Whether you’re just starting or looking to expand, understanding and fulfilling your licensing requirements is essential for long-term success.
LegalZoom can help you navigate the process with ease. Get your personalized business license report today and focus on what you do best—running your business.
