CA Business License Basics
If you own a business in California you'll need a license to operate. There are many different types of California business licenses and permits that are required by various government entities at federal, state and local levels. An operating license is the basic type of business license that most all businesses will be required to have.
Each level of government has specific regulations and requirements that must be met before a business can get a license. If you don’t comprehend the licensing rules in California and follow them it could lead to expensive fines and putting your business in jeopardy.
Types of Business Licenses in California
Federal Business Licenses – The federal government has a number of agencies that regulate and supervise business activities. If your business participates in any one of these federally regulated activities you will need to get a federal business license.
Activities that will be required to get a federal business license include:
- Alcohol manufacturing, importing and sales
- Agriculture
- Firearm dealing, importing and manufacturing
- Ammunition and Explosives dealing, importing and manufacturing
- Aviation
- Wildlife related activities
- Mining
- Drilling
- Commercial fishing
- TV and radio broadcasting
- Trucking
State Business Licenses – Nearly all California businesses will need to obtain some kind of state business license in order to legally operate. At the very least a business will have to get a professional or occupational license. California business licenses are typically used for tax purposes.
Local Business Licenses – Local California governments and municipalities also grant business licenses. All businesses will be required to acquire some type of local business license in order to operate in California.
Permits – Permits are more specific to a certain type of business within an industry. Permits have a wide selection of purposes from parking to product sales.
How to Get a California Business License
The steps you will need to take to obtain a business license in California will vary depending on which type of business license you have to get. It doesn't matter what type of license you are attempting to get you will need to fill out application form(s) and supply details about your business.
If you are starting a business or expanding your business you will have numerous forms to fill out. Be prepared to supply your Employer Identification Number (EIN).
The SBA (Small Business Administration) has great online tools for helping business owners decide exactly what type of California business licenses they need to get, links to websites, applications and instructions. If you’re just starting a business and need assistance with licensing, the SBA is the perfect place to learn more.
Maintaining Your California Business License
Once you get your California business licenses and permits you must still maintain them year after year to keep them up to date. The guidelines below are recommended if you wish to ensure your business license is in good standing.
- Make copies of your business licenses and permits.
- Monitor when licenses and permits need to be renewed.
- Follow the regulations for displaying your business license.
- If you intend to change or expand your business be sure to verify whether you need additional permits or business licenses.