Updated October 27, 2020:

What is a California Business License?

Some of the local areas refer to the business license as a general business license while some refer to it as a business tax certificate. If you do business in more than one city, you'll need a separate business license for each location. The State requires additional licenses or permits, like a Seller’s permit, or follow regulatory mandates. Do your research before starting your business.

The Governor’s Office of Business and Economic Development (GO-Biz) provides a central hub on information about starting or relocating businesses to California. The Office of Small Business Advocate (OSBA) can also help provide more information to businesses.

Why is a Business License in California Important?

You cannot do business in the State of California without having the appropriate business license or business tax certificate for the city or county you are operating in.

Types of Business Licenses in California

  • General Business Licenses

    • These are your basic licenses, referred to interchangeably as a business license or a business tax certificate. Depending on your jurisdiction, you can submit your application via the internet, by postal mail, or in person. The fees for a license will depend on the jurisdiction as well, but it is usually a flat rate, a gross sales percentage, or a combination of the two. You will need to provide your owner and business name and address, contact information, the business type and structure, federal tax ID number, number of employees, and predicted yearly sales. Different jurisdictions tax different business types at different rates, so if you have the option of choosing where you will locate your business, do your homework.

  • Licenses for Regulated Professions and Industries

    • These are licenses in addition to general business licenses, used for compliance with other licensing, environmental or regulatory and administrative laws. Check out the California Government Online to Desktops (CalGOLD) to search a database of regulated professions and industries. Additionally, if you sell or lease merchandise, you must get a Seller’s permit, which can also be done online.

  • Fictitious Business Name Statement

    • In other cases, you will need to use a fictitious name statement, also known as a ‘doing business as’ (D.B.A) if you are running a business under a company name other than its legal name. So, for example, if your dog-walking company is registered as ‘Company X’, but uses ‘The Bone Ranger’ for marketing, websites and uses this name in the community, it must apply for and renew its DBA with the county in which it operates.

How to Get a California Business License

The good thing is, getting a license is actually pretty easy. Visit the city hall or city offices where you will be doing business or check the city's online pages. You may be able to download and print the business license application forms to mail in or hand deliver. You may even be able to apply for the license and pay your fee online for some cities. Fresno and Sacramento are two of the cities where you can apply online.

Before you apply for the business license be sure you have the following on hand:

  • Business name and address

  • The mailing address for the business if it is different from the physical location

  • The business phone number

  • What type of business you have, whether a corporation, limited liability company, sole proprietorship, or partnership

  • The employer identification number from the Internal Revenue Service

  • The seller’s permit number, which is required before you get a business license if you are selling goods anywhere in California

  • The names, addresses, phone numbers, and driver's license numbers of all of the owners

  • What type of business you will be conducting

  • The number of employees you will be hiring

  • How much you expect to make annually

Some cities charge a fixed fee for the business license while others base the fee on your annual sales.

Should I Start a Business in California?

Whether you should start a business in California depends on your considerations. Despite a relatively high level of taxation and regulation, California has created some of the largest and most successful companies in the world from its founder’s garages.

  • Companies based in the state do better than competitors in other states when you compare performance measures.

  • From 2011 through 2015, California businesses did better than the S&P 500 by 23 percent.

  • Several industries made California Number 1 in business including healthcare, energy, consumer staples, biotech, and specialty pharma.

  • As of the first quarter of 2015, 26 of the 122 U.S.. companies in the Bloomberg America’s Clean Technology Index were based in California. All of the companies were publicly traded; and their spending averaged 25 percent of their sales – about $118 million – for research and development.

Frequently Asked Questions

  • Do I need additional licenses for certain types of businesses?

Yes. Some businesses require that you have additional licenses. These may include hairdressers, plumbers, accountants, restaurants, and other types of services. You can find the licenses you need by visiting CalGold.

You may also visit each city's website to see if they have a list of special permits or licenses needed. For example, you can find such a list for Sacramento on their website. Keep in mind that different levels of government might have different requirements - always check each county, city, and the California requirements for the type of business you run.

  • Are there special permits I have to purchase at the State level?

Yes. Several types of businesses must obtain a permit at the state level, regardless of what you need for the local level.

  • I am filling out the application for my general business permit and it is asking for a seller's permit.

If you are selling products in California, you must have a seller's permit. You can apply for a seller's permit online.

If you have questions about starting a business in California or getting a California business license and permit(s), post your legal needs on UpCounsel. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of Google, Menlo Ventures, and Airbnb.