Are you looking to start a business in San Diego? Here are the basics on how to get started:
1. Make a Business Plan
To begin, it is advised that you create a business plan before starting your business. The business plan will help you get organized and, if you are applying for a bank loan to fund your business endeavors, you will need to have one in order to qualify for loan consideration anyway. Once you have finalized your business plan, it is time to figure out the logistics of your business.
2. Selecting a business name, type, and legal structure
Naming your business, declaring its legal structure, and determining activity type are crucial. What you choose to name your business is entirely up to you. You may choose to name it after yourself, titling it “Bob Jones Cleaning”, for example. It is important to note that if you do not name your company after yourself or you decide on a fictitious business name, you must register it with the County of San Diego, Assessor/Recorder/County Clerk’s Office.
After declaring a business name, you should decide on a legal structure for your business. Generally, many businesses decide to declare as a General Partnership or a Sole Proprietorship, as those are usually less complicated. If you decide to declare as a Limited Partnership, Limited Liability Partnership (LLP), Corporation, or Limited Liability Company (LLC), you must register your business with our Secretary of State.
Now that you have chosen a business name and legal structure, you must decide on a business activity type. There are twenty types of business activity categories. Some of these categories include: Retail, Real Estate/Rental/Leasing, and Accommodation/Food services.
3. Location, location, location
After figuring out definitively what type of business you want, you will need to find a spot to run your business. Before signing any leases or contracts, remember to verify with the City to determine whether or not that location is a valid place to operate. There are certain business types than are restricted from legally operating in certain areas of San Diego.
4. Permits and/or Licenses
Permits and licenses are required for legal operation of a business. The type of business operation dictates which permits and licenses are mandatory. To find out which permit and licenses your business requires, please visit the CalGOLD database: www.calgold.ca.gov.
5. Hiring of Employees
There will be several taxes imposed on businesses; they include but are not limited to: employment tax, income tax, and the City’s Business Tax. If your business begins hiring employees, more responsibilities will follow. You will first need to register as an employer, however. Upon registering, you will receive a federal Employer Identification Number (EIN), which is a nine-digit number assigned by the IRS.
6. Business Tax Certificate
If you intend to run a business in San Diego for more than six days per calendar year, it is required that you have a business tax certificate. This certificate is required regardless of whether you are self-employed, have a home-based business, or function as an independent contractor. Applications for business tax certificates must be filed with the Office of the City Treasurer, Business Tax Division.