Steps to Apply for Business Licenses and Permits in California
- Obtain a California privilege license
- Search for any necessary California general business licenses
- Obtain applicable federal licenses for your California business
- Check for California permits and licenses
- Check with the city or county for local licensing in California
- Search for applicable California professional licenses
- Obtain any other necessary California business licenses and permits
- Apply for California home-based business licenses
- Maintain your California licensing
There’s plenty to keep you busy when you’re opening a new business. You need to prepare your financials and business plan, you might need to register your business with the state, and you likely need to apply for business licenses and permits. Starting a new business in California can require a lot of licensing, but this guide and our Business License Report service can help you get it done easily.
What is a business license?
Just like a driver’s license gives you permission to operate a car, a business license gives you permission to operate your business. Some local governments in California require all the businesses in their jurisdictions to have a general business license. Otherwise, your need for a business license or permit depends on the specific attributes of your business. Business license and permit obligations often have to do with the industry you’re in, your location, and your business activities. You might also need multiple business licenses from federal, state, and local government agencies. A lot of different governing bodies might require your business to have a license or permit, but there isn’t a central place to search to make sure you’ve fulfilled all of your licensing and permit obligations.
Step 1: Obtain a California privilege license
Some states require all businesses in their domain to have a privilege license before they can operate. There is no statewide requirement for a business to have a privilege license in California. But it’s important to check with your town, city, and county governments to see if they have privilege license requirements for businesses in your area.
Step 2: Search for any necessary California general business licenses
Some cities and counties in California require all businesses to have a general business license. This means that you have to have a license to operate, regardless of the nature of your business. California doesn’t have a statewide general business license requirement, but some local governments within California do.
Getting your business license isn’t the same as registering your business. For businesses that are required to register, registration is what officially forms those businesses under state law. Getting a California business license (or any other business license) is what gives you the permission to run your business after you register it. Many people think registering a business and licensing a business are interchangeable actions. But they are two important and distinct actions that are required before many California businesses can open their doors.
If you’re still working on registering your limited liability company (LLC) or corporation and you don’t understand the process, we’re here to help. Our California LLC formation and California corporation formation services give you the tools to start your business with ease.
Step 3: Obtain applicable federal licenses for your California business
Some California businesses need federal licenses or permits. If you’re engaged in any of the following business activities, you likely need permits, licenses, or assistance from the following federal agencies:
- U.S. Department of Agriculture – for importing or transporting plants, animals, animal products, biologics, or biotechnology across state lines
- Alcohol and Tobacco Tax and Trade Bureau (and Local Alcohol Beverage Control Board) – for manufacturing, importing, or selling (wholesale or retail) alcoholic beverages
- Bureau of Alcohol, Tobacco, Firearms and Explosives – for dealing, importing, or manufacturing firearms, explosives, and ammunition
- U.S. Fish and Wildlife Service – for importing or exporting wildlife and wildlife-derived products, or for engaging in wildlife-related activity
- National Oceanic and Atmospheric Administration Fisheries Service – for engaging in any kind of commercial fishing
- Federal Maritime Commission – for facilitating cargo shipment by sea or providing ocean transportation
- Bureau of Safety and Environmental Enforcement – for drilling for oil, natural gas, or mineral resources on federal land
- U.S. Nuclear Regulatory Commission – for producing commercial nuclear energy, running a fuel cycle facility, or being involved in distributing and disposing of nuclear materials
- Federal Communications Commission – for broadcasting information by cable, radio, wire, satellite, or television
- U.S. Department of Transportation – for receiving assistance with state permits for operating oversized or overweight vehicles
Depending on how you run your business, you might need multiple licenses from multiple federal agencies. It’s important to understand all the details of your business operations when you seek licensing so you don’t miss a requirement.
Step 4: Check for California permits and licenses
There are many business activities and industries that require a California state business license. In many cases, different state agencies in California handle the licensing for different business activities. Common licenses the state of California oversees include:
- Commercial fishing licenses
- Liquor licenses
- Professional licenses
- Gambling licenses
The California Governor’s Office of Business and Economic Development has an online service that can assist you with business permit requirements, but this service isn’t necessarily exhaustive.
Step 5: Check with the city or county for local licensing in California
A lot of your California business license and permit requirements are probably going to come from city and county governments. Many local governments require businesses in their area to have general business licenses. Your local government might also require you to have a permit or license to engage in specific business activities such as:
- Selling food
- Building or altering a business space
There are a lot of business activities your local government might license, and requirements change in each territory. It also isn’t easy to figure out what licensing requirements your city or county has for your business. If you’re unsure about your local obligations, you can look at your city and county websites, or reach out to your county clerk and local tax offices for more information.
Step 6: Search for applicable California professional licenses
Putting your professional or specialized training to work in a new venture can be a great way to break into the business world. But when you offer your professional or special services, you’re probably going to need a license. The state of California requires licenses for many individuals and professionals, including:
- Medical professionals
- Real estate professionals
- Legal professionals
The above list is just a snapshot of the many professions and occupations that need licensing from the state. In many situations, there are different California bureaus, boards, associations, or departments that handle the licensing for the different professions and occupations you could perform.
Step 7: Obtain any other necessary California business licenses and permits
We have discussed a lot of different California business license requirements, but there are still many other license and permit obligations you might have to consider for your business. Other license and permit requirements you might have to fulfill can include:
- Zoning permits
- Building permits
- Health permits
- Seller’s’ permits
- Sign permits
- Environmental permits
If your business sells or leases tangible personal property, you normally need a seller’s permit from the California Department of Tax and Fee Administration. And you might have to obtain the above-listed permits from the federal, state, or local government to legally run your business.
Step 8: Apply for California home-based business licenses
Setting up a business in your home can be a blessing. You can cut overhead, cut commute time, and increase your free time. However, setting up a home-based business can come with its own intricate rules and licensing or permit requirements. Licenses and permits many home-based businesses in California have to obtain can include:
- Home occupation permits
- General business licenses
- Sign permits
- Building permits
- Zoning permits
- State seller’s permits
In addition to permit and license requirements, many home-based businesses have to comply with several local rules about how to conduct a home-based business. Also, it’s important to review the rules of your homeowners’ association and neighborhood covenant to ensure there are no contractual roadblocks to opening your home-based business.
Step 9: Maintain your California licensing
Most business licenses and permits aren’t ongoing. You’ll likely need to renew your licenses and permits on a periodic basis to keep your business legally compliant. If you fail to renew your licenses and permits, you could do your business significant harm.
We have what you need to help keep your business compliant with California law
There are a lot of moving parts to running a successful business, and understanding licensing and permit obligations can be a significant part that’s hard to figure out. When you have so much to do to keep your business running smoothly, having good help can be the difference between success and failure. We can help you make sure you’re fulfilling all of your licensing and permit requirements with our services.
With our partners at Business Licenses, LLC., we can provide you with our Business License Report. Our Business License Report takes into consideration your business characteristics and location and consolidates all of your business licensing and permit needs at every government level into one simple report.
Once you’ve fulfilled your initial licensing and permit obligations, you can easily fulfill your renewal obligations with our Worry-Free Compliance Service. This service keeps track of your compliance obligations and handles two business amendments for you per year. If you’ve made a mistake while fulfilling your compliance obligations, our Worry-Free Compliance Service also helps you with a plan to get back in good standing. We believe your business contributions are important, and we want to help you succeed.
Disclaimer: The content on this page is for information purposes only, and does not constitute legal, tax, or accounting advice. If you have specific questions about any of these topics, seek the counsel of a licensed professional.
- Do all California businesses need a license?
Although the state of California doesn’t require all businesses to have a general business license, it’s unlikely that a California business can operate without some kind of license from the federal, state, or local government.
- Can you sell things without a license in California?
If you plan to sell or lease tangible personal property that would normally be subject to sales tax if sold at retail, you need a seller’s permit from the state.
- Is it legal to run a business from home in California?
Generally, yes. In many cities and counties, you can legally run a home-based business as long as you follow the local rules and obtain the right licenses and permits. Your ability to run a home-based business could also depend on homeowners association rules or the terms of a neighborhood covenant.
- What kind of license do I need for an online business in California?
The kind of licenses you need to run an online business in California depends on the specific characteristics of your enterprise, such as your industry, your activities, and your location.
- Do I need a license to collect sales tax in California?
Yes. You can apply for a seller’s permit through the California Department of Tax and Fee Administration.