How to Get a Business License in Santa Monica, California

October 29, 2026

Santa Monica is a city of about 90,000 residents, and getting a Santa Monica CA business license means working through two layers. The first is the state paperwork every California business needs. The second is the city's own business license tax, which is a gross receipts tax. This guide covers both, explains how the small business exemption works, and lays out the August 31 renewal deadline so you keep your eligibility. The figures reflect the city's business license pages and the California agencies named below, checked on October 29, 2026.

Informational content, not legal or tax advice. This guide explains how the published rules work. It does not replace guidance from a qualified attorney or CPA, which is especially worth getting if you have multiple owners, employees, out-of-state sales, or a regulated activity. Confirm every figure with the agency that publishes it before you file or pay.

Step 1: Complete the State Registrations First

California has no general statewide business license. The Secretary of State issues none, and the CDTFA seller's permit is not a business license. Instead, your business registers its entity, registers with state tax agencies where needed, and then adds the licenses and permits its activity requires. Start with these:

1. Register your entity with the Secretary of State. File through bizfile Online at https://bizfileonline.sos.ca.gov/. An LLC files Articles of Organization (Form LLC-1) for $70. A stock corporation files Articles of Incorporation for $100. A nonprofit's articles cost $30. If you need to hold a name while you prepare the filing, a name reservation costs $10 and lasts 60 days, and it cannot be renewed for consecutive periods.
2. Register with the CDTFA if you sell taxable goods. The seller's permit is free. The statewide base sales tax is 7.25 percent, and Santa Monica's combined rate is 11.25 percent. Review the rules at https://www.cdtfa.ca.gov/taxes-and-fees/sales-use-tax.htm.
3. Register with the EDD if you have employees. Confirm the employer registration steps directly with the Employment Development Department.
4. Add activity licenses. Regulated trades and professions are licensed by state boards, including the Contractors State License Board and the Department of Consumer Affairs boards. The contractor license threshold is $1,000.

Every LLC and corporation must keep an agent for service of process in California. An LLC must also keep an office in California, though it does not need to be a place of business activity. Confirm the agent rules on the Secretary of State's Business Programs page.

LLC owners should also know the cost rules. Every LLC, LP and LLP organized or registered in California from 2024 through 2026 owes the $800 minimum annual franchise tax starting in 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. An LLC also owes an LLC fee of $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, respectively. The Statement of Information (Form LLC-12) costs $20 and is due within 90 days of filing, then every two years. Corporations file the Statement of Information (Form SI-550) for $25 every year. California does not allow a domestic series LLC, and an LLC cannot render a licensed professional service, so professional corporations are used instead.

If you will operate under a name other than your legal name, file a Fictitious Business Name Statement with the Los Angeles County clerk-recorder within 40 days of starting. The name must be published in a newspaper once a week for four weeks, and the filing expires after five years. The statutory fee is $10 plus $2 per additional name or owner, but counties charge more and publication is billed separately. Details are at the Secretary of State's fictitious business names page.

Step 2: Understand the Santa Monica Gross Receipts Business License Tax

The city's business license tax is a gross receipts tax under Article 6 of the city's code. In general, it is $75 plus a percentage of your Santa Monica gross receipts above $60,000 in each calendar year. Only receipts above $60,000 carry the percentage, so that figure is the number to track.

The city lists exceptions for nonprofit and tax-exempt businesses, businesses on a flat tax, and corporate or administrative headquarters. If one of these describes you, confirm how it applies before you file.

The percentage depends on your business classification, which the city calls your tax rate group. Do not rely on group tables you find on forums, blogs or older council presentations. Measure F (November 2024), which the city calls its business license modernization, changed how some business groups are taxed, and the older tables pre-date it. Use the 2026-27 table on the city's site. Look up your classification on the city's Classifications and Tax Rates page, or call the business license unit to confirm the current percentage for your group. The group percentage is the one number this guide does not state, so check it with the city before you budget.

Step 3: Know the 2026-27 Minimum Taxes

Some businesses owe a fixed minimum regardless of receipts. The city's 2026-27 summary lists these:

Business type	2026-27 minimum tax
In-city residential	$75
In-city commercial	$75
Out-of-city business	$75
Delivery	$50 per unit
Event planner and promoter	$150 per unit
Taxi	$250 per unit
Vendor permit	$50

Every business license also carries the state $4 disability access fee each year. The city keeps 90 percent of that fee.

Step 4: Apply for a New Santa Monica Business License

Apply through the city's "Apply for a Business License" process at businesslicense.smgov.net. Timing matters. Apply and pay within 30 days of starting business in Santa Monica. For applications filed after January 1, 2025, the late penalty is capped at 50 percent of the tax due. The cap limits the damage, but it is not a reason to wait.

Choose your address carefully. A PO box can be your mailing address, but it cannot be your business location.

Step 5: Check the Santa Monica CA Business License Tax Exemption

Santa Monica lets businesses with worldwide gross receipts below a threshold apply for an exemption from the business license tax. The exemption is narrow. It removes the license tax only. You still need a business license, and you still pay the fees and assessments that apply.

The city states the threshold two ways. Its main business license page says $103,000, and its fees page says $100,000. Confirm which figure applies to your filing before you rely on either one. The city also says that businesses whose gross receipts exceeded $100,000 in the prior year do not qualify.

The exemption must be claimed every year, not once. The city may ask for IRS Form 4506-T to verify your receipts.

Some businesses do not qualify, including:

• Corporate headquarters or administrative offices with no gross receipts
• Taxicabs
• Delivery and pickup services and vehicles
• Sidewalk and vehicle vendors

Step 6: Handle the Santa Monica California Business License Renewal

Existing businesses renew and pay by August 31 each year. Paying on time is what keeps you eligible for the exemption. The city's page states that penalties apply starting September 1, 2026. That date has already passed as of this guide's check date, so if your 2026 renewal is unpaid, act now and confirm the current status with the city.

Renew or pay at businesslicense.smgov.net. Older guides that send you to finance.smgov.net are out of date, because renewals and payments run through the business license site.

Step 7: Employer Wage Facts for Santa Monica

• City minimum wage: Santa Monica's minimum wage is $18.47, and the hotel worker rate is $25 from July 1, 2026. Verify both with the city before you set pay.
• State minimum wage: $16.90 in 2026 and $17.40 from January 1, 2027. Verify this with the state before you set pay.

Your Santa Monica Business License Checklist

1. Register your entity with the Secretary of State and hold the name if you need time.
2. Keep a California agent for service of process and, for an LLC, a California office.
3. File a Fictitious Business Name Statement if you operate under a trade name.
4. Register with the CDTFA (free seller's permit) if you sell taxable goods, and with the EDD if you hire.
5. Obtain any state board license your activity requires.
6. Apply for your Santa Monica license and pay within 30 days of starting business.
7. Estimate your gross receipts and confirm your tax rate group with the city.
8. Check your exemption eligibility, then claim it every year.
9. Renew and pay by August 31 each year at businesslicense.smgov.net.

Where to Get Help

The California Small Business Development Center network offers business advising at californiasbdc.org. The SBA's Los Angeles district page, which covers Santa Monica, lists local resources at sba.gov/district/los-angeles. For tax questions, such as where your receipts land against the exemption threshold, ask a CPA. For entity structure, contracts, and licensing questions, ask an attorney. Both can save you more than their fees cost when your filing is complicated.