- Plan a Business
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If you're thinking about setting up a business as a building contractor, start here for a checklist of items to consider and permits that you may need to obtain to get your business off the ground. Please note that this guide does not substitute for legal or professional advice, and additional permits may be required depending on the circumstances of your business.
The Building Contractor Checklist covers key items that you may consider when starting your business. Get a head start on the planning process by knowing upfront what to expect so you don't run into unexpected surprises that may delay your grand opening.
If you're planning to rent a commercial office space, make sure the property you’re interested in has the right zoning for a restaurant by looking on ZIMAS. Also look to see if there are any overlay zones or other special planning zones – these may suggest additional restrictions above and beyond the zoning requirements.
Are you planning to operate out of your home? Take into account City zoning requirements for working out of your home, as there are regulations around the number of deliveries and clients you may have per day to limit the impact of your business activity on your neighbors. You may also not park commercial vehicles at your home or use mechanized equipment that wouldn't normally be used in a residential setting.
Review your lease closely before signing it. Keep in mind that commercial leases are very different from residential leases. You may also consider hiring a lawyer to help you review and negotiate your lease.
If you plan to make any changes to your office space, building permits are required for electrical, plumbing and structural changes to a building, including additions, alterations, construction and demolition. To obtain a building permit, you will need to file building plans, have them approved and schedule an inspection to verify the work after it has been completed. Depending on the scale of the project, there are different “plan check” options for LADBS to review your building plans – ranging from an online application and automatic approval for simple projects to an extended review of architectural and structural drawings for large, complex projects.
Before you open your doors, you will need to register your business, your business name, and business entity. Check out the online start-up guide to get a tailored guide on how to formally register your business with the City, County, State, and Federal Government and get set up to pay business, sales,and payroll taxes.
In California, anyone who contracts to perform work on a project that is valued at $500 or more for labor and materials must hold a current, valid license from the State of California Contractors State License Board (CSLB). To obtain a license, you will typically need to meet certain minimum requirements for experience, technical training, apprenticeship training, and/or education, and pass a written examination.
Review the California Contractors License Law & Reference Book for more information about any rules and requirements that you may need to be aware of.
To become licensed, provide the CSLB a contractor bond or cash deposit.
As an employer, you are required by law to provide workers' compensation insurance to provide wage replacement and medical benefits in the case of any on-the-job injuries.
You may obtain workers' compensation insurance through a commercial broker-agent, directly with a licensed insurance company, or through the State Compensation Insurance Fund (State Fund). You may also self-insure if you have a net worth of $5 million, net income of $500,000 per year and obtain approval from the state.
All employers must immediately report serious occupational injuries, illnesses, or the death of an employee to the State of California Department of Industrial Relations. If your business has 10 or more employees, there are additional requirements to keep records of any occupational injuries and illnesses. Learn more about the specific record-keeping requirements for your business, in addition to other resources that support workplace safety for you and your team.
Review the Hiring Section for information on additional wage and employment guidelines.
If you prefer a personal touch to getting your business of the ground, check out the Resources Section of the Business Portal. You can find organizations that might be helpful to you along the way, or visit one of the City's nine BusinessSource Centers for dedicated, free technical assistance.
The State of California Contractors State License Board produces a number of guides and publications that provide useful information for contractors and may answer any additional questions you have.