Launching a Cannabis business (California)
By: Cold-Pressed Cannabinoids
Tags: Startup, California, Business, Marijuana, Cannabis

Welcome to our series on the best places to launch a Cannabis business. California cannabis businesses have made $3.1 billion in legal and recreational Cannabis sales. It’s the highest of any US state, and the figures are growing exponentially. It’s a perfect place to start a cannabis business thanks to vast quantity of consumers.

The California Secretary of State supports California businesses by registering business entities, including cannabis-related entities, and processing millions of filings and record requests each year. The California Secretary of State’s office is the first stop for those seeking to establish a cannabis-related business.

10 steps to starting a Cannabis business in California

You should seek professional or legal assistance, as necessary and can gain more information on the points below in this brochure.

1. Choose an Entity Type & Business Name — the type of entity will effect how your business is taxed and the type of licence required.

2. Register Your Business with the Secretary of State — at this stage you will be required to pay the appropriate fees.

3. Register a Fictitious Business Name — you may be required to do business under a different name to obtain business licenses and permits.

4. Obtain Required City and/or County License, Permit or Other Authorisation — check with your local city and county in which the cannabis related activities will take place to determine what steps your business may need to take to obtain a required license for related activities.

5. Obtain both a Seller’s Permit and Cannabis Tax Permit from the California Department of Tax and Fee Administration

6. Obtain Required State License — there are three state agencies charged with licensing cannabis-related activities. Those licensing agencies are as follows:

Bureau of Cannabis Control — licenses testing laboratories, distributors, retailers, and micro-businesses.

CalCannabis Cultivation Licensing Program licenses cannabis cultivators and administers the Track-and-Trace system.

Manufactured Cannabis Safety Branch (MCSB) — licensing manufacturers of cannabis products, such as edibles.

7. Employer Responsibilities — you must register your business as an employer and obtain a federal Employer Identification Number (EIN).

8. Tax Information — there are several agencies that administer taxes for businesses in California. They should be consulted to determine any obligations that your business may have.

Internal Revenue Service (IRS) administers all federal taxes except alcohol, tobacco, and customs duties.

Franchise Tax Board (FTB) administers personal income tax and corporation tax.

Employment Development Department (EDD) administers four state payroll taxes.

California Department of Tax and Fee Administration (CDTFA) administers business permits and taxes.

California State Board of Equalization reviews and adjusts assessments for property taxes.

California Tax Service Center is a partnership of tax agencies that have joined together to streamline and improve taxpayer resources and educational programs.

9. Ongoing Business Registration Requirements — you are required to file a Statement of Information with the California Secretary of State within the first 90 days of registering and annually thereafter (every two years for nonprofit corporations and all LLCs).

10. Trademarks and Service Marks — once your service or product is lawfully in use you may wish to register your trademark with the California Secretary of State’s office.

California is the land of opportunity for Cannabis businesses. This is supported by the recent BDS Analytics, thats expects the state to reach $7.2 billion in Cannabis sales by 2024.