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Across the country the federal government, states, counties and cities require companies to provide information that allows them to register their businesses, protect their business names, hire employees, pay taxes and be in compliance with regulations. Some steps in the registration process are free, and sometimes a business must pay registration fees.

Registering a new company
The start-up process can require interacting with federal, state and local agencies just to register a business name and obtain an identification number.

The City of San José has tried to make it easier for new businesses to register with federal, state and local agencies. The following information may also be helpful to companies that have changed their operations, expanded or relocated to San José.

How to choose a company name?

One of the first things a new business owner might do is come up with a name for the business. Some owners use their own names as the business name, but many entrepreneurs choose a unique name for their company that best fits their business goals. This is a useful first step because federal, state and local registration requires that business owner state the name of the business. It may be helpful for the business owner to research other companies names to prevent duplication of an existing name, especially within the local market.

The California Secretary of State maintains a listing of names of corporations, limited partnerships and limited liability companies conducting business in the state. For more information The California Secretary of State will also check name availability, at no cost, as explained on its website. Business owners can also “reserve” a corporate business name for up to 60 days while handling other start-up tasks. 

Owners starting businesses in San José should also review existing names listed with the Santa Clara County Clerk Recorder. The business owner is responsible for ensuring that the chosen name does not duplicate a name already in use. The County provides a website for entrepreneurs to search existing business names. Business owners can also pay a fee for the County to perform a search of business names.

The U.S. Small Business Administration also provides useful information about this step.

How to choose a legal structure for the company?

Along with selecting a name, business owners must also choose a legal structure for the business. Options for legal structure include sole proprietorship, different types of partnerships, limited liability company and corporation. The federal government defines these options and sets rules and eligibility criteria for each. Each option has legal and tax implications. Many business owners consult an attorney or accountant before selecting an initial structure. The business structure can be modified as business circumstances change. 

Again, the U.S. Small Business Administration offers information about choosing the business structure best suited to the particular company. 

How to file business structure documents with the California Secretary of State?

Some businesses must file documents related to their business structure with the California Secretary of State’s office. (Corporations, limited liability partnerships and limited liability companies need to do this; sole proprietorships do not.) The California Secretary of State offers general information about business structure on its “Starting a Business” web page. 

The Secretary of State describes each structure and the documents that must be filed to create that type of business. 
Sole proprietorships need not create and file these types of documents with the Secretary of State.

How to register the company name with the State and with Santa Clara County?

Business owners should usually register their business names right after they have chosen the name and filed any necessary documents with the California Secretary of State.

The Secretary of State requires owners starting corporations, limited partnerships and limited liability companies to register their corporate names with the State. Companies can “reserve” a name for a period of 60 days before having to file corporate documents. Out-of-state companies must also register with the California Secretary of State. 

Some businesses have a “corporate” name as well as another name marketed to the public. This second name is known as a “doing business as” name, and it must also be registered.
The Santa Clara County Office of the Clerk Recorder is the local agency responsible for registration of business names for owners of businesses based in San José, including sole proprietorships. The County requires business owners to file the business name statements before the owner begins doing business or within 40 days of the first transaction. (Note that the County uses the term “fictitious business name” when referring to the “doing business as” name.)

Business owners can go to the Clerk Recorder’s Fictitious Business Name Filings web page to register their name. There is a small fee for registering the name. Business owners can also register a name in person at the Clerk Recorder’s office or by mail, using a form that can be downloaded from the Clerk Recorder’s website. 

How to register the company name with the federal government and obtain an Employer Identification Number?

The federal government requires each business to have an Employer Identification Number (EIN), also known as an Employer Tax ID. Having this number will help with state and local registration and with such tasks as opening a bank account for the business. 

Once the business owner has a business name, a business structure and an address suitable for registering the business, he or she can apply for an EIN with the Internal Revenue Service (IRS). The business owner can apply online, by telephone (800 829-4933), by fax or by mail. The IRS explains these different methods on its "How to Apply for an EIN" web page.

Also, business owners who have changed their ownership or structure must usually obtain a new EIN.

Most other business registration, including registering as an employer or to pay sales taxes, is handled by state and local agencies. Some specialized business types, however, such as certain transportation and agricultural businesses, must obtain federal licenses and permits.  Beyond obtaining an EIN, most new business owners do not need to contact other federal agencies to start their companies. 

Registering a company to pay sales taxes, payroll taxes, unemployment insurance, and city and county taxes
All businesses in San José must register with the City and obtain a business tax certificate (similar to a municipal business license). Depending on the type of business and whether it has equipment or employees, the business owner might also need to obtain other licenses and permits from the State of California and Santa Clara County.

How to obtain a seller’s permit from the State of California?

Retailers and certain other businesses must collect sales taxes on the items they sell. The California State Board of Equalization registers businesses that must collect sales or use taxes in California. Businesses apply for a seller’s permit that allows them to collect sales taxes and report taxes to the State. The permit can be obtained on the State’s website.

Where to register if the business has employees?

The State of California requires that companies with employees have workers' compensation insurance and pay unemployment insurance. 
  • Businesses usually obtain workers' compensation insurance through insurance carriers. Companies pay unemployment insurance to the State of California. 
  • A business must register with the California Employment Development Department to pay unemployment insurance.
Companies also register with the Employment Development Department to pay state and federal payroll taxes and to withhold employees’ state and federal income taxes.

Click here for more information about registering with the Employment Development Department.  

Where to report equipment, fixtures and other fixed assets?

Businesses in San José pay Santa Clara County taxes on their equipment and other business property. Businesses can review information about this business property tax on the web site of the Office of the Assessor, County of Santa Clara.  

How to obtain a Business Tax Certificate with the City of San José?

Any person or company conducting business within the City of San José must register with the City. This Business Tax Certificate must be obtained within 45 days of starting business in San José. The City Finance Department issues Business Tax Certificates (which are equivalent to municipal business licenses). The fee, due each year, is calculated based on the size of the business. Click here for more information about tax rates and form.

Are there other County permits and licenses?

Food-related businesses must obtain certain permits from the County of Santa Clara Department of Environmental Health.

Are there other City permits and licenses?

Some businesses must obtain other City permits and licenses. For example:
  • If a business discharges industrial wastewater into a sewer, it must obtain an Industrial Wastewater Discharge Permit from the Enforcement Division of the Environmental Services Department.
  • Land Use Permits, including zone changes, variances and conditional use permits, are issued by the Planning Department.
  • The San José Police Department issues permits for several special business activities.


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spacer.png Be sure to register your business with the City and renew registration annually.

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