My first year in business, I got a scary letter from the City of Los Angeles that said I owed business tax of almost as much as I had earned.
In that moment, I made a vow:
No one else would have a cardiac event at the tentacles of local government on my watch.
Updated for 2026, here’s how not to get screwed as a freelancer or small business operating in the City of Los Angeles. Especially since you need to complete your registration by March 2, 2026, since the end of the month falls over a weekend.
Yes, the City of Los Angeles has different requirements
Most cities require you to file for a business license. It usually has an annual fee, maybe a reporting requirement. Perhaps, separately, your location will charge a tax on your business income.
But Los Angeles is different. We mush all of these things together. You cannot simply register your business. You must declare what kind of business you have, and then, based on an arcane formula, the city will tell you what amount of tax you must pay in order to get your business license.
You must have a business license. Some of you will be allowed to make a bunch of money and owe nothing. Others of you will operate at a loss and still have a substantial tax bill — capitalism is just the best sometimes.
TL;DR: Your guide to the City of Los Angeles Business Tax
- If you were physically present in Los Angeles for at least six days, or if your permanent work address is within the city limits, your business must register with the Office of Finance annually by February 28.
- Because this year’s deadline falls on a weekend, the filing deadline has shifted to Monday, March 2.
- Los Angeles assesses a gross receipts tax, which means you may owe money even if you operated at a loss.
- Filing is the only way to get a business license, and the variable tax amount is your registration fee.
- Yes, the city really can slap you with a misdemeanor and a fine if you don’t register.
Even if you don’t live in Los Angeles, you may owe taxes
It doesn’t matter if you live in Burbank, Boise, or Baltimore — you may still need to register.
If you earned revenue while physically in the City of Los Angeles on six or more days, your earnings activities within the city are subject to the gross receipts tax and business filing requirement, regardless of where your business is located.
As we gear up to welcome back more film and television production and host a wide variety of sports and entertainment events, you may also need a City of Los Angeles business permit.
If you plan to create content or host a weeklong event in Los Angeles, you’ll need to register with the city. Keep in mind, what you consider Los Angeles might be one of 23 other independent cities within LA County, which have different rules. (The City of Los Angeles does have maps, which can help you determine if you’re operating within city limits. But double and triple check your location. These maps can be confusing.)
Local business taxes 101 for LA business owners and freelancers
Whether or not you get a 1099, if you earned $600 or more from self-employment activities, you must self-report.
Whether it’s a side hustle, a one-day gig, or just helping out a friend:
- If you live in the City of Los Angeles and you got paid, you need a Business Tax Registration Certificate.
- If you live in the City of Los Angeles and did ANY freelancing last year, or you set up a business that’s run from a Los Angeles address, you need to do this IMMEDIATELY.
- If you’re filing retroactively for 2025, you’ll immediately be prompted to pay the amount due to maintain a business license.
Before you stress over how you’re going to pay a surprise bill, the City provides a few exemptions. If you are a new business in your first or second year, a small business with less than $100,000 in global gross receipts, or a Creative Artist individual or business with less than $300,000 in revenue, filing on time will exempt you from the city tax.
If you’re not one of those categories, you’ll be assigned a tax rate per $1,000 of revenue based on your business activities.
How to file your LA Business Tax for the first time
If it’s your first time, start here. If you’ve filed before, use the Business Tax Renewal page.
You will need:
- Your filing number or EIN or Social Security number
- Your total gross revenue for 2025
- Total revenue earned while physically located in the City of LA
- How much you earned NOT in the City of LA (including Burbank, West Hollywood, Santa Monica, and the 23 other independent cities inside of LA County)
- How much you earned from “creative arts exemption” activities
- If you’re a cannabis business, how much state excise tax you owe
Once you complete the form, you will instantly be provided with a tax bill and options to pay by online check, ACH transfer, or credit card.
If you’ve been taken by surprise and need more time to pay, you can request installment options by calling the city or stopping by an office with the required information. If your tax and interest is current but you’ve received a penalty letter, you can request a waiver of penalty here.
If you file on time annually, your exemptions will automatically be applied.
However, if you make even $1 over an exemption level, you’ll have to pay your city tax bill in full to keep your permit.
The gross receipts tax structure is controlled by the LA City Council. If you’d like Los Angeles to join almost everyplace else in taxing profits, contact your council representative.
