How to Start a Business in San Francisco in 2026 (Step by Step)

Starting a company in San Francisco is more approachable than the bureaucracy makes it look — if you do the steps in the right order. This guide lays out exactly how to start a business in San Francisco in 2026, from choosing a legal structure to registering with the city and handling local taxes, with rough costs and timelines at each stage.

A quick disclaimer: this is practical guidance, not legal or tax advice. Rules and fees change, so confirm specifics with the official sources we link before you file.

Step 1: Validate, then plan

Before any paperwork, prove someone will pay. Talk to potential customers, test pricing, and write a one-page plan covering what you sell, to whom, at what cost. This single page will steer every decision that follows.

Step 2: Choose your legal structure

Your structure shapes your liability and taxes. A sole proprietorship is simplest but offers no liability shield. An LLC is the popular middle ground for small businesses. A corporation (often a Delaware C-corp) is the standard if you plan to raise venture capital. We cover the mechanics, costs and the California franchise tax in how to form an LLC in California.

Step 3: Register with the state

If you’re forming an LLC or corporation, file your formation documents with the California Secretary of State. Be aware that California imposes an annual minimum franchise tax on most LLCs and corporations — budget for it from day one.

Step 4: Get your EIN

An Employer Identification Number is free directly from the IRS and takes minutes online. You’ll need it to open a business bank account, hire employees and file taxes. Never pay a third party for what the IRS gives away free.

Step 5: Register with the City of San Francisco

Almost everyone “doing business” in San Francisco — including online and out-of-city sellers with a local presence — must obtain a business registration certificate from the Treasurer & Tax Collector, generally within 15 days of starting. The fee scales with your size. We walk through the exact filing in how to get a San Francisco business registration certificate; the official portal is the Office of the Treasurer & Tax Collector, with broader help at sf.gov.

Step 6: Licenses and permits

Beyond registration, your specific activity may need permits — food service, retail, professional licensing, signage or a home-occupation permit. If you sell physical goods, you’ll also need a seller’s permit. Map your requirements against our San Francisco permits guide.

Step 7: Banking, taxes and a compliance calendar

Open a dedicated business bank account on day one — mixing personal and business money is the most common rookie mistake. Then build a calendar for federal, state and city deadlines. The layers of local tax (registration fee plus gross-receipts tax, with small-business exemptions) are explained in San Francisco small business taxes.

The order matters: get your EIN before you open a bank account, and register your entity before you register with the city. Doing steps out of sequence is what forces expensive do-overs.

Frequently asked questions

How much does it cost to start a business in San Francisco? It varies widely: state filing fees, the annual franchise tax, the city’s registration fee and any permits. A simple service business can start for a few hundred dollars plus the franchise tax.

Do I need to register with the city if I work from home? Generally yes — most businesses operating in San Francisco must register, even home-based and online ones. Confirm with the Treasurer & Tax Collector.

LLC or corporation? An LLC suits most small businesses; choose a corporation if you intend to raise venture capital.