SANTA CLARA COUNTY BUSINESS LICENSE FEES AND TAXES

What is a Business License Tax?

First, it is important to understand what a business license is. In Santa Clara County, all 15 cities require that a business register and pay a tax or a fee for engaging in business activity within that city. Usually there is a time frame of 90 days or so in which yo are required to register your business. Large corporations, small businesses, and independent contractors alike are required to obtain a business license in cities that have them. As independent contractors REALTORS® often fit into different categories for each city. In San Jose you may be considered an employee under your broker. In other cities you may have to pay separate from your broker. While the rules and regulations for business licenses vary by city, they are mostly similar in the sense that they require a business tax or fee to be paid before receiving the licence. These taxes are annual and must be paid in order to conduct business within a city. Regardless if you think your broker is covering you, as an independent contractor is is YOUR RESPONSIBILITY to know the law and ensure you are compliant.

How Is It Structured?

A business tax as it relates to the real estate profession usually has three components: a base tax, a per employee tax, and if you owner or manage a rental property =a per unit tax. The base task is determined city by city. Prices across different cities in California vary depending on cities. Per employee taxes differ as well and a broker may be required to pay for the agents they oversee, but these are usually determined on scales of how many employees (agents) are working. A rental property tax is typically determined per unit.

What If I Already Pay In One Jurisdiction, Do I Have To Pay In Another?

Most cities will require you to pay in each location in which you you have a physical location for you business and where you help a client buy, sell, or manage property. This does however vary by city.

Exemptions?

Some cities will have exemptions from the license tax. For example, a city may have an exemption if a business earns less than double the poverty line.

How Do I Pay My Tax?

Each city will usually have a website with the forms needed in order to register your business and pay the taxes in order to obtain a business license. In some cases you may have register in person. Most cities will have online registration forms and once those are completed a business tax can be paid online we we have included in this article below.