The Complete Guide to California Business Licenses
"Do I need a business license in California?" is one of the most common questions new owners ask. The answer depends on where you operate and what you do, but almost every business needs some combination of local, tax and industry licenses before it opens. Getting them right protects you from fines and lets you open bank accounts, sign leases and work with suppliers.
Does California Require a State Business License?
No. California does not issue a general statewide business license. Filing Articles of Organization with the California Secretary of State creates your LLC, but it is not a license to operate. California licensing comes from local business licenses, the state seller's permit and professional licenses. The state's CalGold website helps you find the permits that apply to your business and location.
City and County Business Licenses
Almost every California city requires a business license or business tax registration certificate, and counties license businesses in unincorporated areas. Los Angeles, for example, issues a Business Tax Registration Certificate, and San Francisco requires business registration with the Treasurer and Tax Collector. Home-based businesses usually need a local license and must follow zoning rules.
California Seller's Permit (CDTFA)
If you sell or lease tangible goods in California that would normally be subject to sales tax, you need a seller's permit from the California Department of Tax and Fee Administration (CDTFA). The permit is free and is issued online. Your permit number is what you use on a California resale certificate (CDTFA-230) to buy inventory tax-free. Employers also register with the Employment Development Department (EDD) for payroll taxes.
California LLCs also pay an annual minimum franchise tax of $800 to the Franchise Tax Board, separate from any license.
Professional and Occupational Licenses
The California Department of Consumer Affairs (DCA) oversees boards that license many professions, including barbers and cosmetologists, accountants and many healthcare roles. Contractors are licensed by the Contractors State License Board (CSLB), real estate agents by the Department of Real Estate, and alcohol sellers by the Department of Alcoholic Beverage Control (ABC).
Business Licenses for California LLCs
An LLC still needs the same licenses as any other business. The usual order is: form your LLC, get your EIN, register for California taxes, then apply for local and industry licenses in the LLC's name. Forming the LLC first means every license is issued to your company, not to you personally. Read the California LLC guide for formation costs and steps.
How Incofile Helps
Incofile can form your California LLC, get your EIN and research every license and permit your business needs at the city, county, state and federal level. You receive a clear report with each license, the agency that issues it and how to apply, delivered to your 24/7 client portal. See our business license research service, or read do I need a business license for the basics. Selling products? Our guide to resale certificates explains how to buy inventory tax-free.
Frequently Asked Questions
Do I need a business license in California?
California has no general statewide business license, but most businesses need a local business license from their city or county, a seller's permit if they sell tangible goods, and any professional license their work requires.
How do I get a business license in California?
Form your entity, apply for a business license with your city or county, get a seller's permit from the CDTFA if you sell goods, and apply for any professional license from the relevant state board.
Is a California seller's permit free?
Yes. The CDTFA issues seller's permits at no cost, although some businesses may be asked for a security deposit.
Does a California LLC need a business license?
Yes. Forming an LLC registers your company, but it is not a license to operate. Your LLC still needs local, tax and industry licenses, and it owes the $800 annual franchise tax.
Do I need a license for a home-based business in California?
Usually, yes. Most California cities require a business license for home-based businesses, and many also require a home occupation permit.
What is CalGold?
CalGold is a free California state website that lists the permits and licenses that may apply to your business based on its type and location.