Low-rise stucco storefronts and palm-lined boulevard under hazy morning light, How to Get a Business License in Pasadena, California

How to Get a Business License in Pasadena, California

If you plan to operate inside Pasadena city limits (population about 135,800), you will deal with two kinds of paperwork: state filings that create and register your business, and a city business tax that every operating business in Pasadena must pay each year, whether or not it makes a profit. California does not issue a general statewide business license, so the Pasadena business license you need is the city business tax registration plus any permit your specific activity requires. This guide walks through each step, using the fee amounts in the city's adopted FY 2027 Schedule of Taxes, Fees and Charges. The fiscal year begins July 1, 2026.

Step 1: Understand what California does and does not license

The California Secretary of State issues no business licenses or permits. The seller's permit issued by the California Department of Tax and Fee Administration (CDTFA) is a tax registration, not a business license. A typical Pasadena business therefore moves through four layers:

  1. Register the entity with the Secretary of State (required for LLCs and corporations).
  2. Register with the CDTFA if you sell taxable goods.
  3. Register with the Employment Development Department (EDD) if you have employees.
  4. Obtain the Pasadena business tax registration and any licenses or permits your activity requires.

Most California cities charge a local business tax or registration certificate. Of the 483 cities in California, 445 report revenue from one, and there is no common formula, so the answer depends on the city. Pasadena's answer is below.

Step 2: Form your entity with the Secretary of State

File through bizfile Online or by paper. Online filings are normally processed within about 5 business days or less. Paper filings take 10 or more business days. Expedited options are a 24-hour filing for $350, a same-day filing for $750 (received by 9:30 a.m.), and a 4-hour option for $500 (drop-off only, precleared). The main filing fees are:

FilingFee
Articles of Organization, LLC (Form LLC-1)$70
Articles of Incorporation, stock corporation$100
Articles of Incorporation, nonprofit$30
Name reservation (lasts 60 days)$10
Statement of Information, LLC (Form LLC-12), every two years$20
Statement of Information, corporation (Form SI-550), every year$25

An LLC name must include "limited liability company," "L.L.C." or "LLC" ("Limited" may be "Ltd." and "company" may be "Co."). It may not include "bank," "trust," "trustee," "incorporated," "inc.," "corporation" or "corp." Reserve a name at the name availability page. A reservation cannot be renewed for consecutive periods.

An LLC must keep an agent for service of process in California. That agent must be an individual who lives in California or a corporation holding a Corporations Code 1505 certificate. The LLC must also keep an office in California. California does not allow a domestic series LLC. An LLC also cannot render a licensed professional service, so professionals such as doctors, lawyers or accountants use a professional corporation instead.

Every LLC organized or registered in California from 2024 through 2026 owes the $800 minimum annual franchise tax from its first year. An LLC whose first taxable year begins in 2027, 2028 or 2029 pays $400 in year one under RTC 17941(g)(2), so confirm the first-year amount with the Franchise Tax Board (FTB). On top of the $800, the LLC fee is $900, $2,500, $6,000 or $11,790 once California-source total income reaches $250,000, $500,000, $1,000,000 or $5,000,000. A newly incorporated or qualified corporation or S corporation owes no $800 minimum in its first taxable year.

Step 3: Register for the Pasadena business tax

Pasadena requires every business operating within city limits to pay an annual business license tax. The business tax year varies by license class, and fees are paid in advance. You can apply, renew and pay online, by phone, by mail or in person through the Business Services Section at 100 North Garfield Avenue, Room N106, Pasadena, CA, or by calling (626) 744-4166.

For tax purposes, an employee includes owners, partners, family members and anyone working in the business, paid or not. Count everyone who works there when you choose your class.

The FY 2027 amounts for the most common classes are:

Business classFY 2027 amount
General business (Municipal Code 5.16.020)$215.36, plus $42.73 for each employee beyond one
Business with take-out service$429.30 basic tax, plus $85.54 for each employee beyond one
Professional business (Municipal Code 5.16.030)$571.98 for the first professional, $285.24 for each additional professional, plus $42.73 per non-professional employee
Contractor, general engineering (annual)$1,723.68
Contractor, general building (annual)$1,149.56
Contractor, specialty (annual)$862.55
Other building tradesman (annual)$862.55
Rental accommodations (hotel, rooming house)$211.80 for three accommodations, plus $22.85 each additional
Non-residential building under 1,000 square feet$116.02
Non-residential building, larger$230.67 for the first 1,000 square feet, plus $22.85 for each additional 1,000 square feet

The schedule lists many other classes. Confirm yours with Business Services before you pay, because the wrong class can mean the wrong amount. The business license tax has a maximum of $82,311.66. A license transfer costs $57.28, and a duplicate license costs $11.40.

Owners of commercial property, or rental property with three or more units, need a business tax permit for the building. Commercial locations also need a code compliance inspection.

The first-year $1.00 rate: check eligibility first

A reduced $1.00 business license tax applies only if all of the following are true. The business is first-year. It is in a Commercial or Industrial zoned area. It has five or fewer employees. Its 2012 NAICS code falls in one of four sectors: Construction (23), Manufacturing (31 to 33), Information (51) or Scientific, Technical and Professional Services (54). Retail and restaurant businesses fall outside those sectors. At the first renewal anniversary after the reduced year, the full tax for that fiscal year is due. Confirm eligibility with Business Services before you assume the $1.00 rate applies to you.

Step 4: Get a seller's permit if you sell tangible goods

A seller's permit is required for retail or wholesale sales of tangible goods, and it must show your Pasadena address. The permit is free. Apply through the CDTFA sales and use tax page. The statewide base sales tax is 7.25%, and with district taxes city rates run from 7.25% to 11.75%. Pasadena's sales tax rate is 11.00%. If you buy goods for resale, the resale certificate has no required form.

Step 5: Register with EDD if you have employees

If you hire anyone, including family members who work in the business, register with the EDD for payroll tax accounts. California's minimum wage is $16.90 in 2026 and $17.40 from January 1, 2027, according to a secondary source, so verify both figures with the state before you set pay.

Step 6: Add the approvals your activity requires

  • Food businesses need approval from the Pasadena Health Department before opening.
  • Alcohol sales require a license from the Department of Alcoholic Beverage Control (ABC).
  • Contractors need a Contractors State License Board (CSLB) license for jobs of $1,000 or more, labor and materials included.
  • Other regulated trades and professions are licensed by state boards under the Department of Consumer Affairs. Counties license only regulated activities.
  • Charitable nonprofits must apply with a 501(c)(3) determination letter to be exempt from the city fee.

Step 7: File a fictitious business name if you use one

If you operate under a name other than your legal name, file a Fictitious Business Name Statement with the County Clerk-Recorder for the county of your principal place of business. For a Pasadena business, that is Los Angeles County. File within 40 days of starting to do business. You must also publish the statement in a newspaper once a week for four weeks, and publication is a separate cost. The statutory filing fee is $10, plus $2 for each additional name or owner, but counties charge more, so confirm the Los Angeles County fee before you file. A fictitious business name expires after five years. Details are on the Secretary of State fictitious business names page.

Home-based businesses: the Home Occupation Permit

A business run from a residence needs an approved Home Occupation Permit from Code Compliance, (626) 744-4633, plus signed permission from the property owner. The rules are strict:

  • The business use must stay secondary to the home.
  • No signs and no displayed merchandise.
  • No use of the garage or carport for the business.
  • Only household residents may be employed.

The city says some business types are prohibited at home, including auto repair, hair salons and medical offices. Businesses in the South Lake Business Improvement District pay an added fee. Confirm the permit fee with Code Compliance, because it is not listed in the schedule this guide relies on. A home business still needs the Pasadena business tax registration, the Secretary of State filing if it is an LLC or corporation, and any state approval for its trade.

Renewal: what recurs and when

Pasadena business tax renewals follow the tax year for your license class, and fees are paid in advance. Check the due date on your city notice, or call Business Services at (626) 744-4166, because the due date depends on your class. Keep these recurring obligations on your calendar as well:

  • LLC Statement of Information (Form LLC-12): $20, every two years, during the six-month window ending on the last day of the anniversary month of your filing.
  • Corporation Statement of Information (Form SI-550): $25, every year.
  • LLC franchise tax: the $800 minimum and any LLC fee, every year.
  • Fictitious business name: a new statement after five years.
  • Penalties: the FTB assesses a $250 penalty after a Secretary of State notice if a Statement of Information is missed.

A Pasadena business license does not transfer between owners. A new owner needs its own license, and a separate license is required for each branch or separate place of business.

Where to get help

Important note

This article is informational content, not legal or tax advice. Fees, classes and deadlines change, and the city schedule lists many classes not covered here. Confirm every figure with the agency named before you pay or file. If your situation is complex, such as choosing between an LLC and a corporation, a professional practice, multiple owners or a business that operates in several cities, consult a qualified business attorney and a certified public accountant (CPA).

Keep exploring: related California guides