What is a business
license?
A business license is an annual regulatory permit for the
privilege of conducting business within City. This license is issued after a
business has complied with applicable local, state and federal requirements and
has paid the annual gross receipts tax, applicable fees and assessments.
Business license taxes, applicable fees and assessments are due and payable
prior to commencing business within the City of Santa Monica.
Who is required to get a
business license?
Any person or entity who conducts business in or whose
business is based in Santa Monica, must obtain a Santa Monica business license.
Conducting business without a license can result in penalties, notices of
violation, citation and possible criminal prosecution.
What do I need to know
to open a business in Santa Monica?
Santa Monica is a vibrant business community and one of the
most popular tourist destinations in California. For helpful information on
opening a new business or expanding your existing business, visit Santa Monica Economic Development.
What is my business
license tax based on?
Business license taxes are based on the tax rate associated
with your assigned business classification, see Classifications & Tax Rates. With only a few exceptions, business license taxes
are $75 plus a percentage of your Santa Monica gross receipts in excess of
$60,000 for the calendar year.
How is my tax rate
determined?
Tax rates are based on the business activity. For a
detailed listing of the tax rate groups, see the Classifications & Tax Rates summary.
How do I know how much
I'll have to pay?
While almost every business in Santa Monica is subject to
business license tax, other fees may apply to your application and renewal.
Open the Business License Tax Calculator (Coming Soon) to
assist you in calculating your business license tax liability. For more
specific information on the City's various fees, see the Business License Classifications & Tax Rates summary and the City's interactive Fees Database (Coming Soon).
What is the State CASp
$4 fee I have to pay each year?
On September 19, 2012, Governor Brown signed into law Senate Bill (SB)
1186 which adds a state fee of $1 on any applicant for a local
business license, similar instrument or permit, or renewal. The purpose of this
fee is to increase disability access and compliance with construction-related
accessibility requirements and to develop education resources for business in
order to facilitate compliance with federal and state disability laws, as
specified.
On October 11, 2017, Governor Brown signed into law Assembly Bill
(AB) 1379, which changed the State CASp fee starting January 1,
2018. This bill accomplishes the following:
- Removes the sunset provision for the CASp fee, establishing it as a
permanent fee.
- LEGISLATIVE
UPDATE - Please be advised that effective January 1,
2024, the SB 1186 Fees will remain $4.00, with local
jurisdictions retaining 90% of the fees indefinitely. Assembly
Bill 2164 (Lee, 2022) removed the sunset provision for the
fee, enabling local governments to collect the $4.00 and 90% retention
indefinitely.
Under federal and state law, compliance with disability
access is a serious and significant responsibility that applies to all
California building owners and tenants with buildings open to the public. You
may obtain information about your legal obligation to comply with the
disability access laws at the following agencies:
How do I know if my
business is allowed where I want to locate it?
Please check with the City's Planning
Division to determine if your business’ use is permitted in a
particular zone. The City of Santa Monica has various land uses or zones that
are defined in the City's Municipal Code that
allow for various types of business uses.
I conduct business in
several cities. Can I get just one license to do business in ALL of them?
No, there is no universal business license. If you are
conducting business in multiple jurisdictions, you will need to contact each
jurisdiction to determine if a business license is required. It is important to
know that most California cities and counties have a Business License tax
ordinance. However, each city has its own tax rate, structure, and
requirements. Check with the appropriate city or county for theirs.
Is my information
confidential?
The City's Municipal Code guarantees
the confidentiality of gross receipts information and prohibits revealing the
information to anyone not charged with the administration and enforcement of
the ordinance. Business name, location, phone number, and owner's name are
subject to the California
Public Record Act.
May I register my
business from a PO Box or PMB located within Santa Monica?
A post office (PO) box or private postal mailbox (PMB)
address may be used as the mailing address of record for receiving information
regarding a Santa Monica business license; however, a PO Box or PMB address
does not constitute a business location for business licensing purposes. A PO
Box or PMB address cannot be substituted as the business location address for
any business, whether physically located within the City of Santa Monica or
located outside of the City.
