Step:
Finance
Permit
The Finance Department handles the collection of various taxes and permit fees for the City. Business related fees include business licenses, alcohol sales permit fees, Downtown Business Improvement District assessment, admissions tax, parking deficiency fees, and transient occupancy tax.
The parking deficiency fee and downtown business improvement assessment are addressed in the Downtown section as shown on the menu to the left and alcohol sales permit fees are addressed in the Alcohol Licensing section.
Business License
Once you have the Zoning Clearance in hand from the Planning Department, you’re all set to get your Business License. The Finance Department issues Business Licenses, which are an annual fee charged to businesses operating in the City of Santa Cruz as a way to monitor business activity in the City and best prioritize our resources to help businesses across all City departments as well as the variety of free resources for businesses online.
Most businesses are subject to a basic, annual business license fee of $145.15 plus employees fees. Depending on the type of business, the additional fee is $2.55, $4.95, or $7.40 per employee. Not too bad, right? To determine the applicable fees for your type of business visit the Finance Department Business License page. Payment of business license fees are due on or before the starting date of your business in Santa Cruz. If you’re unsure what your fees will be, you can contact the Finance Department's Revenue Division to clarify the fees at (831) 420-5070. Business Licenses are processed at the Planning Counter, which is located at 809 Center Street, Room 206 (on the second floor of the two-story City Hall building near the stairwell nearest the parking lot).
How to Get Your Business License
| Address: | Visit MyCityofSantaCruz.com to apply. If a zoning clearance is required it will need to be approved before you can receive your business license. |
| Fees: | $145.15 plus employee fees if applicable. In addition to the basic business license tax, applicants for a new license are charged a $28 registration fee and a $4 fee mandated by the State of California for accessibility compliance. Annual business license renewals are charged the business license tax, a renewal fee of $9, and the $4 state-mandated fee. |
| Processing Time: | Completed applications, with an approved Zoning Clearance if required, can be processed typically within 2 business days. Business Licenses are emailed once the application is received and processed. |
| Information Needed: | Contact information, address, type of ownership, Employer ID number if applicable, and number of employees (if any) |
Admission Tax & Entertainment Permits
If your business will have live music, dancing or other forms of entertainment and an admission is charged, you may be subject to the admission tax.
How Does It Work?
The tax is 5% on the price of admission or registration for events within the city limits of Santa Cruz. For example, an admission of $5.00 would be taxed $.25; for a total of $5.25 to be collected. The tax collected is remitted to the City Finance Department. The Admissions Tax Certificate Application for On-going Event Operators can be viewed here.
One-Time Event Admissions Tax
If you have a one-time event, and don’t provide ongoing events, you must register in the Finance Department for a one-time admission tax operator's certificate prior to collecting the tax. The One-Time Event Admissions Tax Form can be viewed here.
The certificate must be displayed at the event for which the tax is to be collected. At the time of registration, you must also estimate the number of admissions or registrations to the event, and pay an advance deposit based on the estimated admissions. You’ll be provided with an Admissions Tax Deposit form for this purpose. You’ll also be provided with an Admissions Tax Return form to be completed and returned to the Finance Department within ten (10) days after the event. You’ll determine the actual number of admissions and the total amount of admission tax due from the event.
Transient Occupancy Tax
The City charges a Transient Occupancy Tax (TOT), also known as a "bed tax" or "hotel tax," which is charged to guests staying at a hotel, motel, vacation rental or other lodging facility for periods of thirty (30) days or less.
The Transient Occupancy Tax (TOT) is 12% of the room rents received in the applicable reporting period, including all mandatory fees such as cleaning fees, pet fees, extra person fees, resort fees, management fees, linen fees, etc. The tax is paid by the guest and collected by the hotel, motel, or lodging operator, and then remitted to the City. The tax must be charged to the guest and separately stated from the amount of rent charged. However, if the lodging operator does not collect the tax from the customer the operator is still responsible for payment of the tax.
If your property is subject to the TOT, you are required to register with the City within thirty (30) days of commencing business, and to file monthly TOT returns. You can view the TOT Eligibility Checklist Form here.