How to Start a Hair Salon Business in California

October 29, 2026

Opening a hair salon in California is a licensing project before it is a business project. Every person who cuts, colors or styles hair in your space needs the right personal license, the salon itself needs its own establishment license, and the business must be registered with the Secretary of State and the tax agencies before the first client sits down. This guide covers those steps in the order you should handle them.

Disclaimer: This article is general information, not legal, tax or licensing advice. Rules, fees and processing times change. Confirm every figure with the agency named before you spend money, and consult a qualified attorney or CPA about your entity choice, lease, employment arrangements and booth rental contracts.

What You Need Before You Start

Gather these items first. Several of them are needed at more than one step.

• Government-issued photo ID and proof of age. Applicants for the cosmetology and hairstylist licenses must be 17 or older.
• Proof of completing the 10th grade or an equivalent, such as a transcript.
• Your school transcript showing the hours completed in a cosmetology or hairstylist course.
• A debit or credit card for the exam application, the establishment application and Secretary of State filings.
• A business name you have checked for availability. You can reserve it for $10.
• A California address for the salon, a lease or other proof of the right to occupy the space, and a floor plan showing the practice room, the entrance and the toilet room.
• A registered agent for service of process: a California resident individual, or a corporation that holds a Corporations Code 1505 certificate.
• A written list of every licensed service the salon will offer and the license each service requires.

Step 1: Get the Personal Licenses Your Team Needs

The Board of Barbering and Cosmetology (BBC, barbercosmo.ca.gov) licenses the people who perform services in a salon. Two licenses cover most hair work.

• Cosmetologist: requires a school course of at least 1,000 hours under Business and Professions Code (BPC) 7362.5. SB 803 lowered this requirement from 1,600 hours, effective January 1, 2022.
• Hairstylist: requires a school course of at least 600 hours under BPC 7363. This is the shorter, non-chemical path. Confirm with the BBC exactly which services the hairstylist license covers before you build your menu or hire around it.

Both licenses use a written exam only. The practical exam has been removed. Plan for these fees:

• Exam application fee: $125 for the cosmetologist and hairstylist exams. This is the exam application fee, not a combined exam and license fee. Ask the BBC whether any other fee is due when the license is issued.
• Renewal: every two years at $50, with a $25 delinquency fee.

Other trades have their own licenses. Barbers, estheticians, electrologists and manicurists each need the license for their practice. A manicurist license requires 400 hours and carries a $110 fee, so confirm with the BBC what that fee covers. Every person who performs a licensed service in your salon must hold the right license. Employing someone who is not licensed for the work is unlawful under BPC 7349, and the mistake falls on the salon owner.

Step 2: Apply for the Establishment License

The establishment license is separate from the personal licenses. Under BPC 7346, any premises where a licensed service is practiced needs one. The BBC fees are:

• Application: $50, nonrefundable.
• Renewal: $40.
• Delinquency: $20.

The establishment must be in the charge of a licensee (BPC 7348). The application includes an acknowledgment of the owner's responsibility for labor law compliance (BPC 7347). Before you sign a lease, make sure the space includes a public toilet room and handwashing facilities as required by BPC 7351 and 7352.

Home salons

A home salon is possible only if the space is truly separate from your living quarters. The practice room cannot be used for residential purposes, and the establishment must have a direct entrance that is separate and distinct from any entrance to private quarters (BPC 7350). Violating this is a misdemeanor. A shared hallway or a door that leads through the kitchen does not meet the test. Ask the BBC and your city before you build or convert a room. Local business license and zoning rules for a home salon are city decisions, so confirm them with the city directly.

Step 3: Decide Between Booth Renters and Employees

Your staffing model determines your tax, payroll and liability obligations. The two options look different on paper and in practice.

Booth rental

In a booth rental arrangement, a licensed stylist rents a chair or station from you and runs their own business. Under Labor Code 2778(b)(2)(L), a licensed cosmetologist, barber, esthetician, electrologist or manicurist falls outside the ABC test when the arrangement meets the following conditions. Treat this as a checklist for every renter:

• The renter sets their own rates, processes their own payments and is paid directly by clients.
• The renter sets their own hours and has sole discretion over the number and choice of clients.
• The renter has their own book of business and schedules their own appointments.
• The renter maintains their own business license for the services they offer.
• When the renter works at your location, they issue a Form 1099 to the salon owner from whom they rent the space.

Even with booth renters, you still hold the establishment license, and the owner's responsibilities under BPC 7347 remain with you. If a stylist does not meet every item on this list, treat the arrangement as employment and talk to an attorney or CPA before you sign anything.

Employees

If you set schedules, set prices, direct the work or pay wages, you have employees. Register with the Employment Development Department (EDD) before you pay your first employee. California's minimum wage is $16.90 in 2026 and $17.40 starting January 1, 2027. Verify both figures before you set payroll, because they come from a secondary source.

Step 4: Register the Business

California has no general statewide business license. The Secretary of State issues no licenses or permits, and the CDTFA seller's permit is not a business license. Your business registers its entity with the Secretary of State, registers with the CDTFA if it sells taxable goods, registers with the EDD if it has employees, and adds the licenses and permits for its activity. The steps below follow that order.

4a. Choose and file your entity

Most salon owners choose between an LLC and a corporation. The Articles of Organization (Form LLC-1) cost $70. Articles of Incorporation for a stock corporation cost $100. Filing is done through bizfile Online at bizfileonline.sos.ca.gov. Online filings are normally processed within about 5 business days or less. Paper filings take 10 or more business days. Expedited options from the Secretary of State are:

• 24-hour processing: $350.
• Same-day processing: $750, if received by 9:30 a.m.
• 4-hour processing: $500, drop-off only and precleared.

An LLC name must contain 'limited liability company,' 'L.L.C.' or 'LLC.' It cannot contain 'bank,' 'trust,' 'trustee,' 'incorporated,' 'inc.,' 'corporation' or 'corp.' You can search availability at the business search page. A name reservation costs $10 and lasts 60 days, and it cannot be renewed for consecutive periods. A corporation name needs no designator.

An LLC cannot render a licensed professional service, and professional corporations are used instead. Whether a salon falls under that rule is a question for your attorney or CPA. California also does not allow a domestic series LLC.

4b. Plan for franchise tax

Every LLC, LP and LLP organized or registered in California from 2024 through 2026 owes the $800 minimum annual franchise tax from its first year. The first-year exemption covered only LLCs formed from 2021 through 2023. 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. A newly incorporated or qualified corporation or S corporation owes no $800 in its first taxable year.

4c. File the Statement of Information

An LLC files a Statement of Information (Form LLC-12) for $20 within 90 days of filing the articles, then every two years during the six-month window ending on the last day of the anniversary month. The Franchise Tax Board assesses a $250 penalty after a Secretary of State notice if the filing is missed. A corporation files Form SI-550 for $25 within 90 days of filing the articles, then every year.

4d. Name a registered agent and keep a California office

Your LLC or corporation must keep an agent for service of process: an individual who lives in California, or a corporation that holds a Corporations Code 1505 certificate. A corporate agent has no address entered. An LLC must also keep an office in California. It does not have to be a place where business activity happens.

4e. File a fictitious business name if you need one

If the salon will operate under a name other than the legal name on your entity filing, you need a Fictitious Business Name Statement. File it with the County Clerk-Recorder in the county of your principal place of business. The statutory fee is $10, plus $2 per additional name or owner (Business and Professions Code 17929). Counties charge more. For example, Tehama County charges $31, plus $5 per additional name. The newspaper publication fee is separate. You must file within 40 days of starting to do business. You must publish the statement in a newspaper once a week for four weeks, and the statement expires after five years. Details are at the Secretary of State fictitious business name page.

4f. Get a seller's permit if you sell taxable goods

Hair services and retail product sales are treated differently. If you sell shampoo, styling products or other goods, you need a seller's permit from the California Department of Tax and Fee Administration (CDTFA). The permit is free. California's statewide sales tax base is 7.25%, and with district taxes, city rates run from 7.25% to 11.75%. A resale certificate has no required form. Confirm with the CDTFA which of your sales are taxable at cdtfa.ca.gov.

4g. Check your city's local business tax

Most California cities charge a local business tax or registration certificate. Of the 483 cities, 445 report revenue from one, and there is no common formula. Counties license only regulated activities. Call or check the website of the city where your salon will operate before you open.

4h. Hire licensed contractors for build-out work

Contractors who perform work totaling $1,000 or more must hold a license from the Contractors State License Board. Confirm each contractor's license before you sign. Also confirm whether your city requires a permit for the work.

Common Mistakes to Avoid

• Treating $125 as the all-in license cost. It is the exam application fee. Ask the BBC about any other fee due at issuance.
• Assuming a home salon can share an entrance. BPC 7350 requires a direct entrance separate from private quarters, and violations are misdemeanors.
• Letting a renter practice without a business license. Booth renters must maintain their own business license for the services they offer.
• Hiring an unlicensed assistant to perform services. BPC 7349 makes employing unlicensed people unlawful.
• Looking for a state business license. There is none. Your registrations are the Secretary of State filing, the CDTFA seller's permit if you sell taxable goods, EDD registration if you have employees, and your city's local business tax.
• Missing the fictitious business name deadline. File within 40 days of starting, and publish the statement once a week for four weeks.
• Skipping the Statement of Information. Missing it can lead to a $250 penalty for an LLC.
• Forgetting franchise tax. The $800 minimum applies even in a year with little or no income.

What to Expect and What You Can Reasonably Plan For

The timeline depends mostly on your school hours, exam scheduling and the speed of your filings. Online Secretary of State filings are normally processed within about 5 business days or less, while paper filings take 10 or more business days. Plan your opening date around the slowest license or registration you need, not the fastest. A booth rental model may reduce your payroll obligations, but it requires written agreements and careful attention to the five conditions listed above. A well-organized licensing file, with the establishment application and the owner's labor law acknowledgment completed correctly, is more likely to move without delays. These outcomes are typical expectations, not guarantees, and actual results depend on your city, your lease and your team.

Get Help Before You Commit

California's Small Business Development Center network offers free and low-cost advising on business plans, financing and registration. Find a center at californiasbdc.org. For decisions about entity choice, booth rental contracts, employment status, leases or home salon zoning, talk with a qualified attorney or CPA before you sign. This article is informational only and is not legal or tax advice.