Sacramento is a great place to move an existing business or start a new operation. There are millions of people to sell your products or services to and plenty of available real estate to set up shop. It's even possible to run an online business from your home in Sacramento, thanks to home occupancy laws and zoning rules. That said, following the right process to get your Sacramento business license is important.
This means that you need to fill out the application, which is available online. On that application, you'll need to include information about your company, personal information, driver's license, and even your business's estimated revenue. Typically, you can expect to pay around $100 to $300 for your business license, and you have to renew your license each year to remain in good standing.
If this sounds complicated, don't panic—you’re in the right place. Read on to learn everything you need to know about business licenses in Sacramento, California.
Sacramento Business License
Step 1: Start a Business in Sacramento
Step 2: Apply for Your Sacramento Business License
Step 3: Get Approval for Zoning
Step 4: Apply for Special Licenses or Government Permits
Contents
Does California Require a Business License?
California might require a business license depending on the type of business. While you won’t need one for general business in California, there are specialty licenses that you’ll need if you want to do business in the state. Typically, these licenses are for selling alcohol, guns, and other heavily regulated goods or services. So, does California require a business license? Well, it depends. Take some time to see if your industry is regulated and learn how to get the necessary licenses.
Sacramento Business Licenses: What You Need to Know
A business license is a document that permits you to do business in a city’s jurisdiction. In this case, the Sacramento business license permits you to operate in Sacramento. While this license allows you to operate in Sacramento, it doesn’t give you any special privileges elsewhere, so it’s only good for Sacramento. This means you’ll have to get licensed in other parts of California to move your company there or start a business in a city other than Sacramento.
Who Needs a Business License in Sacramento?
Anyone who wants to do business in Sacramento needs a license. Without one , the city can’t collect taxes and will not know about your business operations. If you’re caught operating without a license, you will be fined and penalized. A general business license is typically enough to open a business to the public.
On the other hand, more complicated businesses that require specializations require more licensing. For example, you’ll need a different license and permit to sell food from a truck on the street. Professionals will also need licenses to sell their products in Sacramento. This includes lawyers, doctors, insurance agents, plumbers, and other professionals.
How Much Does a Business License in Sacramento Cost?
The cost of a business license in Sacramento is average compared to the cost of a business license in other cities in California. On average, expect to pay around $138 to $175 for residential and commercial licenses in Sacramento.
That said, some factors influence the cost of a license. For example, a special business license will cost more than $300, and $204 for second-hand pawn businesses. These are only a few examples, and you might need to pay for multiple licenses if you plan on selling various products in one location; a great example would be selling marijuana, tobacco, and alcohol in the same location.
Your company’s revenue can also impact the cost of a business license in Sacramento.
Can You Get a Sacramento Business License Online?
Yes, you can register for a business license online in Sacramento. You can visit the city’s online portal, which will walk you through the process. To get started, you must register your business and create an account. From there, you can apply for a license or renew an existing one. Make sure you renew your license each year to avoid any penalties. It’s also important to note that you need to register any online businesses as well.
The Requirements for Starting a Business and Getting Licensed in Sacramento
There are many steps that you must complete if you want a business license in Sacramento. Learn the steps and requirements to start a business and get licensed in Sacramento below.
Step 1. Start a Business in Sacramento
The first step to getting your business license and meeting the requirements is to start a business in Sacramento. While it gets complicated if you have a unique business, if you’re applying for a general business license, you just have to create a company and form a legal entity. A legal entity is a designation for the structure of a company. Some examples include LLCs, sole proprietorships, partnerships, and DBAs.
When starting a business in California you also need to develop a business plan and register the name with the California Secretary of State. It’s also a good idea to get all the intellectual property associated with that name, including domains and similar domains.
Lastly, consider insuring your business to protect you from liability and appoint a relationship agent if you operate an LLC.
Step 2. Apply for Your Sacramento Business License
Once you have a business and a legal entity it’s time to start the application process. In Sacramento, you must fill out a form that meets the business license requirements. The form is available online, and you have to choose between a General Business License, a Special Business License, or a Tobacco Business License. Each license is unique and you have to fill out the form specific to your business. That said, you might need more than one license in some situations.
Once you have the application you can fill out a form and mail it in or apply for your license online by creating an account. The requirements from here are simple. You need to provide the following information:
- Full name
- Business name
- Business Location
- When the business was started
- Business activities
- Your business plan
- Estimated gross receipts
- Driver’s license
- EIN
- Social Security number
These are only some of the requirements for you to file for a license. Check each application to see what you need for your specific industry.
Step 3. Get Approval for Zoning
Whether you want to start selling goods from your home online or build a factory, zoning is essential. Before you can apply for your business license, you’ll have to be approved by the Sacramento Planning Department. You’ll need approval for your project, which you can get by contacting the office in your district of Sacramento via the government’s website.
You’ll also need approval for home occupancy. Some rules for home occupancy to note include:
- Employees who don’t live at the residence can’t work at the residence
- Only ⅓ of the total home space can be set aside for business use
- Only eight customers can visit the home per day, and it has to be one at a time over 8 hours
- The use of the residence as a business must be incidental and not the home’s sole purpose
- No mechanical equipment can be used for business operations; you can’t make dust, odors, or noise with equipment
- You can’t remodel the home to change its appearance for the business
When it comes to home occupancy, you need to follow these rules, or you will be shut down. Additionally, some types of businesses are prohibited. Examples include tow truck companies, EMT operations, body art services, cabinet makers, and many more. You can learn about all of the restrictions on Sacramento Code Enforcement’s website.
Step 4. Apply for Special Licenses or Government Permits
California does require some licenses depending on the types of products you sell or services you provide. This also applies to the federal government, so it’s important to consider any additional licenses or government permits you may need. In California, you’ll have to get licensed by the state to sell things like marijuana, tobacco, alcohol, and firearms. Some additional licenses that Sacramento will require include licenses for:
- Food vending vehicles
- Food vending vehicles on private property
- Entrainment permits
- Bike sharing permits
- Bingo permits
- Astrology permits
- Funeral escort permits
- Licenses for a massage practitioner’s office
- Short-term rental properties (Airbnb)
- Sidewalk vending permits
- Taxi permits
These are only a handful of the specialty licenses required in Sacramento. California may also require additional licenses for professionals, and you may need the same license but for federal approval as well. It’s also important to note that the fees for these licenses will vary depending on your needs.
Renew Your Sacramento Business Licenses
Business licenses in Sacramento must be renewed yearly for your business to remain in good standing. Failing to renew your license will result in expensive penalties and fees. Thankfully, this can be done online and the process is faster and simpler than the initial application process. Still, make sure you read all of the forms carefully to know when it’s time to renew your license. This will help you avoid any unnecessary penalties.
The last thing to note about renewals is that what you pay for your license might change. If your revenue increases, for example, you have to report that change, and it might cost you more money to renew. This is also the case if you decide to acquire a new license.
Get Your Sacramento Business License Today!
California is home to many great cities and Sacramento is no exception. It’s a beautiful place to set up your business and it’s easy to get started if you follow the steps that we outlined. Sacramento also has plenty of online resources to answer any of your questions. Plenty of forms are also available to download online, so you don’t have to worry about doing everything in person. For this reason, Sacramento is one of the best places to start a business and get a license in California.