How to Start a Salon in California

Last updated: February 23, 2026

Opening a hair salon in California means working with the Board of Barbering and Cosmetology (BBC), the state agency that licenses both individual practitioners and salon establishments. California overhauled its licensing requirements with SB 803 (effective January 1, 2022), which significantly reduced training hours and eliminated the practical exam for all license types. If you researched California cosmetology licensing before 2022, the rules have changed.

This guide covers every requirement, cost, and step to legally open and operate a hair salon in California, whether you plan to rent booth space to independent stylists or hire employees for a full-service operation.

Hair Salon Requirements in California at a Glance

How to Start a Hair Salon in California (Step by Step)

Step 1: Get Your Individual Practitioner License

Every person who performs cosmetology, barbering, hairstyling, esthetics, or nail services in California must hold an individual license issued by the Board of Barbering and Cosmetology (BBC). This is separate from the salon establishment license.

California Practitioner License Requirements (Post-SB 803)

SB 803, effective January 1, 2022, made major changes to California’s licensing requirements. Training hours were reduced across all categories, the practical exam was eliminated, and a new Hairstylist license category was created for those who only want to cut, style, and color hair without offering skin or nail services.

Key SB 803 changes:

• No more practical exam – All license types now require only a written exam
• Exams available in multiple languages – The BBC offers the written exam in several languages
• 100 hours of sanitation instruction are included in every training program’s curriculum
• The Hairstylist category lets you start working sooner with just 600 hours if you only want to do hair

Apply for your individual license through the BBC website. Processing times vary, so apply as soon as you complete your training program.

Step 2: Form Your California LLC

File your Articles of Organization online with the California Secretary of State (bizfile). Filing fee: $70. Processing takes 3-5 business days for online filings.

Within 90 days of formation, you must also file a Statement of Information (Form LLC-12) for $20. This is filed biennially thereafter.

Your LLC name must include “LLC,” “L.L.C.,” or “Limited Liability Company” and must not be confusingly similar to an existing California entity. You can check name availability on the Secretary of State’s business search portal before filing.

California Franchise Tax

California imposes an $800 annual franchise tax on all LLCs, payable to the Franchise Tax Board (FTB). However, new LLCs are exempt from the $800 franchise tax for their first taxable year. Starting in year two, it is due annually by the 15th day of the 4th month of your tax year (typically April 15).

If you want to operate under a different name (e.g., “Sunset Beauty Lounge” instead of “Sunset Beauty Lounge LLC”), file a Fictitious Business Name Statement with your county clerk. Cost is typically $10-$80 depending on the county.

Step 3: Get Your Federal EIN

Apply for a free Employer Identification Number at IRS.gov. You will receive it immediately when applying online. You need this to open a business bank account, hire employees, and file business taxes.

Step 4: Secure Your Salon Location

Your salon space must meet BBC establishment standards:

• Hot and cold running water accessible at each work area
• Adequate ventilation – especially important for chemical services
• Proper lighting at all work stations
• Bathroom access for clients and staff
• Separate storage for clean and soiled linens
• Covered waste containers at each station

Before signing a lease, confirm the location is zoned for commercial or retail use and allows salon operations. If you plan any build-out or renovation, secure a building permit from your local city or county building department. Exterior signage may require a separate sign permit.

California commercial rents vary dramatically by market. Expect to pay significantly more in the Bay Area or Los Angeles compared to the Central Valley or Inland Empire.

Step 5: Apply for Your BBC Salon Establishment License

Apply for a salon establishment license through the BBC. This license is required for any location where cosmetology, barbering, hairstyling, esthetics, or manicuring services are performed.

• Application + initial license: $50
• Renewal (biennial): $40
• Delinquency fee for late renewal: $20
• Each physical location requires its own establishment license
• Inspection: The BBC will inspect your salon

Note: The establishment license covers the physical location. Each individual working at the salon must also hold their own valid practitioner license. Both are required.

Step 6: Get Your City Business License

Nearly every city in California requires a business license or business tax certificate. Apply through your city’s clerk or finance department.

• Cost: $50-$500+ depending on your city and projected revenue
• Renewal: Annual in most cities
• Home-based: If operating from home (which is uncommon for salons), you may need a home occupation permit
• Zoning clearance: Some cities require zoning clearance before issuing the business license

Check with your specific city, as requirements and costs vary significantly across California’s 482 incorporated cities.

Step 7: Register for a Seller’s Permit

California has specific rules about sales tax for salons:

• Salon SERVICES (haircuts, coloring, styling, perms) are generally NOT taxable in California
• Retail product SALES are TAXABLE – shampoo, conditioner, styling products sold to clients
• Products consumed during a service (color, developer, perm solution) are generally not taxable when included in the service price

Register for a free seller’s permit with the California Department of Tax and Fee Administration (CDTFA) to collect and remit sales tax on retail product sales. The combined state and local sales tax rate ranges from 7.25% to 10.75% depending on your location.

Step 8: Get Insurance

General Liability Insurance

Covers third-party bodily injury and property damage – a client who slips on a wet floor, an allergic reaction to a product, etc.

• Average cost in California: $500-$800/year
• Typical coverage: $1 million per occurrence / $2 million aggregate

Professional Liability Insurance

Also called malpractice or errors and omissions – covers claims related to the services you provide (chemical burns, hair damage, adverse reactions).

• Average cost: $300-$500/year

Property Insurance

Covers your equipment, furniture, and inventory if damaged, destroyed, or stolen.

• Average cost: $800-$1,200/year

Business Owner’s Policy (BOP)

Bundles general liability, property, and sometimes professional liability into one policy – typically cheaper than purchasing each separately.

• Average cost: $1,500-$3,000/year

Workers’ Compensation Insurance

California has one of the strictest workers’ compensation requirements in the country. Workers’ comp is mandatory for ALL California employers – even if you have just one employee. There is no minimum employee threshold like some other states.

• Applies to all W-2 employees, including part-time workers
• Failure to carry workers’ comp is a criminal offense in California
• You can purchase through a private insurer or the State Compensation Insurance Fund
• Booth renters who are legitimate independent contractors are not covered under your policy (they need their own)

Step 9: Pass Your BBC Inspection and Open

The BBC will inspect your salon to verify compliance with California’s sanitation and safety standards under Title 16, Division 9 of the California Code of Regulations. Be prepared for:

• EPA-registered disinfectant must be available and actively used at every station
• All implements must be cleaned and disinfected between each client
• Single-use items (nail files, buffers, neck strips) must be discarded after one use
• Clean linens stored separately from soiled linens in covered containers
• All practitioner licenses displayed in a visible area
• Establishment license posted where clients can see it
• Proper waste disposal – covered containers at each station

After opening: The BBC conducts routine inspections on an ongoing basis. All 100 hours of sanitation training that practitioners receive during school will be put to the test. Violations can result in fines, citations, or license action.

California Salon Sanitation Standards

The BBC enforces detailed sanitation rules under Title 16, Division 9 of the California Code of Regulations. Sanitation is the most common area of violations during inspections. Key rules:

• All reusable implements (combs, brushes, shears, clips) must be cleaned and disinfected with an EPA-registered disinfectant between each client
• Single-use items must be disposed of after one use or given to the client
• Clean linens must be stored in a closed container separate from soiled linens
• Soiled linens must go directly into a covered receptacle
• All products must be clearly labeled and stored in sanitary conditions
• Each practitioner must wash hands before and after each client
• No animals in the salon except service animals
• Every training program includes 100 hours of sanitation instruction – the BBC expects practitioners to know and follow these rules

How SB 803 Changed California Salon Licensing

Senate Bill 803, which took effect January 1, 2022, was the most significant update to California cosmetology licensing in decades. If you completed your training before 2022 or are researching older guides, here is what changed:

The reduced training hours mean lower education costs and faster entry into the profession. A cosmetologist can now complete training in approximately 6-7 months (full-time) versus 10-12 months under the old requirements.

Cost to Start a Hair Salon in California

Booth Rental Model

Full-Service Salon with Employees

Related California Business Guides

• Starting a Business in California: Complete Guide

← Back to all California business guides

Frequently Asked Questions

What licenses do I need to open a hair salon in California?

You need two types of licenses from the Board of Barbering and Cosmetology (BBC): an establishment license ($50) for the physical salon location, and individual practitioner licenses for every person performing services. Individual licenses require completing an approved training program (1,000 hours for cosmetologists, 600 hours for hairstylists) and passing a written exam. You will also need a city business license and, if selling retail products, a seller’s permit from the CDTFA.

How did SB 803 change cosmetology licensing in California?

SB 803, effective January 1, 2022, made three major changes: it reduced training hours (cosmetologist from 1,600 to 1,000 hours, barber from 1,500 to 1,000 hours), eliminated the practical exam (now written exam only, available in multiple languages), and created a new Hairstylist license requiring only 600 hours for those who only want to cut, style, and color hair.

Are salon services taxable in California?

Salon services – haircuts, coloring, styling, perms – are generally NOT taxable in California. Services are exempt from sales tax. However, retail product sales are taxable at your local combined rate (7.25% to 10.75%). Products used during a service (like hair color applied to a client) are generally not separately taxable when included in the service price. You need a seller’s permit from the CDTFA to collect and remit tax on retail sales.

How much does it cost to open a salon in California?

A booth rental model salon typically costs $25,000-$110,000 to open in California, depending on location and build-out scope. A full-service salon with employees typically costs $75,000-$250,000, with the largest expenses being build-out, equipment, and lease deposits. Costs are higher in major metro areas like Los Angeles, San Francisco, and San Diego.

Do I need workers’ compensation insurance for a salon in California?

Yes. California requires workers’ compensation insurance for ALL employers, even with just one employee. There is no minimum employee threshold. Failure to carry workers’ comp is a criminal offense. You can purchase coverage through a private insurer or the State Compensation Insurance Fund. Note that booth renters who are legitimate independent contractors would carry their own coverage.

What is the California franchise tax and does it apply to my salon LLC?

California imposes an $800 annual franchise tax on all LLCs, payable to the Franchise Tax Board. However, new LLCs are exempt from the franchise tax for their first taxable year. Starting in year two, the $800 is due annually by April 15. This tax applies regardless of your salon’s income level and is in addition to any income tax you owe.