Registering for Permits
The business activity type chosen largely determines the licenses and permits needed to operate a business legally. Keep in mind, business licenses are obtained through your local city and business entity registration is through the California Secretary of State. Find out about other permits and licenses you may need by using CalGOLD, a database that provides you with links and contact information for permitting and licensing agencies.
Filing for local licenses and permits
Most cities and counties require a license to do business in the respective areas.
Various permits may be required for parking and building occupancy. Fire safety regulations will be taken care of by the building owners in most cases.
Businesses within the incorporated area of a particular city should contact the business licensing section of that city government for specific rules and regulations. Businesses operating in more than one city or county may be required to have more than one business license. The business license fee varies with location; it may be a flat rate, percentage of gross sales, or a combination of factors.
In addition, companies may be subject to local personal property taxes and be required to register with the county assessor’s office. Other local taxes, such as hotel occupancy, may require deposits and special permits. Information on specific requirements should be requested from local city or county clerk’s offices.
County government levies and administers property taxes. The State Board of Equalization performs an oversight role relative to county assessors’ activities. Property tax is levied on 100 percent of assessed valuation. The tax rate is 1 percent plus a component representing bonded indebtedness for the district in which the property is located on the lien date. The average property tax rate in California is 1.1 percent, but varies on a parcel basis.
Real property is appraised upon change of ownership or new construction, and then adjusted annually at the lower of 2 percent of the rate of inflation as measured by the Consumer Price Index. Assessed values on real property may be reduced if the value is higher than the current market value.
Business personal property, including machinery, equipment, and fixtures is taxed at the same rate as real property, but is not subject to any special assessments. Unlike real property, business personal property is reappraised annually. Business owners must file a property statement with the county assessor each year detailing market value.
Finish goods and raw materials are not subject to property tax. Only finished goods held for us are assessed.
Additional information on business licenses and permits is available through Permit Assistance.
If you would like additional information on Property Taxes please visit the BOE website by clicking here.