How to Start a Small Business in San Diego, California

Over the last two years due to Covid-19, millions of small businesses, which make up 99.9% of all US businesses, have closed down or are struggling to stay afloat.

Despite the continued hardship the Covid pandemic has inflicted on small businesses, it appears the American entrepreneurial spirit is still alive.

Many Americans continue to start their own businesses, and the number of new businesses is expected to reach a record high in the coming months due to the great resignation, which has seen millions of workers leave their jobs to be their own bosses. I’m assuming that you’re reading this post because you too would like to be your own boss by starting a small business in San Diego.

Congratulations on making the bold decision to do so!

In this article, I’ll take you through a few legal steps you need to take to get your San Diego business started.

I also assume that you already have an idea of the type of business you want to open, its business structure, where it will be located, and probably have even registered the business with the California Secretary of State’s office.

Having these details in mind will make it easier for you to understand the different steps I described below.

Before I get started, however, I would like to say that starting a business in San Diego, CA, can be challenging and you should consider getting professional support to successfully launch your entrepreneurship journey.

3 Key Steps You Should Take to Start Your San Diego CA Small Business

  • Register for a San Diego Business Tax Certificate

Whether you’re starting a sole proprietorship, general partnership, LLC, or corporation in San Diego city you must apply for a Business Tax Certificate, which you’ll use to pay your company’s taxes.

To get the certificate you need to fill out the San Diego Business Tax Application form, which you can download online.

Information required in the application form includes:

  • Type of business you want to start, which could be a sole proprietorship, LLC, etc.
  • Name of business
  • Business contact information and physically address
  • What business activities you’ll be carrying out
  • Number of individuals you’ll employee
  • Your name, phone number, email, professional license numbers, and address
  • The fire department and police permit your business requires

Once you fill out the form you can submit it online, send it via mail, or take it in person to the San Diego City offices.

It usually takes up to 2 weeks for a business to be issued with the Business Tax Certificate after an application is done.

When you receive your certificate you’re required to prominently display it at your business premises.

If your business will have several branches you have to get a separate Business Tax Certificate for each location.

If you don’t apply for a Business Tax Certificate and are caught operating your small business in San Diego without it you’ll be fined $68.

  • Register a Fictitious Business Name

If your business name is different from your full name you need to register a Fictitious Business Name (FBN).

For example, if your name is Mark Wright and your business name is “Mark’s Dinner” you need to apply for an FBN because your business name leaves out your last name. (Using the name Mark Wright’s Dinner doesn’t need an FBN.)

If you’re starting your business with several partners and don’t include all names of the partners in your business name you’ll have to apply for a Fictitious Business Name.

For example, a company named George, Susan, and Associates will need an FBN, but George, Susan, and Kimberly Consulting won’t because all the partners are included in the business name.

To register a Fictitious Business Name in San Diego do the following.

  1. Find out if the FBN you want to use is available by doing a San Diego County business name search online.
  2. If the name is not taken, fill out the San Diego FBN Statement. Details required include:
    1. Your business’s fictitious name and address
    2. Name of business owner
    3. Date business was started
    4. Type of business entity
    5. Signature of business owner
  3. Once you fill the form you can only submit it in person or by mail. In both situations, you must present your government-issued ID. You also have to pay $42 to register your Fictitious Business Name.
  4. Once you apply for your FBN you have30 days to publish your name in an adjudicated newspaper every week for a month.
  5. Then, file proof of publication at the San Diego County Clerk. You also have 30 days to file proof of publication after the publication period has lapsed. If there was no issue with your fictitious name your FBN registration will be complete in a few days.
  • Obtain the Necessary Business Permits

Depending on the industry you’re going into and where your business is located you might need special permits to operate your San Diego business.

For example, if you’re starting a restaurant in San Diego you’ll be required to get a Seller’s Permit and Health Operational Permit from the local health department to be able to sell edible goods.

If you want to open a tattoo parlor you’ll need to apply for a Body Art Health Permit.

Planning to run your business from home? You might have to apply for a Neighborhood Use Permit to be able to have more than one client in your home at a time.

You can check the San Diego County Government website to see the permits required for your business.

The above three steps will let you open the doors to your San Diego small business, but there’s still a lot of legal stuff you have to do.

For example, if you plan to hire employees you must get a Federal Employer Identification Number (EIN), worker’s compensation insurance and adhere to employee eligibility regulations.

To ensure your business doesn’t suffer because a client or supplier is not delivering what they promised, you need to ensure you draft and enter into agreements that guarantee you damages in the event a breach of contract occurs.

Gallagher Krich, APC: Experienced San Diego California Business Formation Attorneys

All the legal work that needs to be done to start a small business in San Diego can be trying and you can make costly legal mistakes if you do it yourself.

To ensure you have every legal process covered, hire us and we can handle the entire business formation process for you.

Gallagher Krich, APC, handling your startup registration will give you more time to do other important things such as hiring the right employees, looking for funding, marketing, etc. to get your business to the right start.

Get in touch with us today at (858) 926-5797 or book an appointment online to talk to one of our attorneys who have over 30 years combined experience in bringing new San Diego businesses to life.

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