Our office is located in Los Ángeles county in a city called Valley Village which is not to far away from Hollywood, Burbank, and West Hollywood. If you’re a client of ours you’re well aware, but if you’ve stumbled upon this blog from the wide web you’ll see why i am giving you guys all this information.
When i have a new business consultation one of the first acts of action is gathering information on the businesses location to make sure that we’re in compliance prior to sinking some of our hard earned money into their endeavor.
Some cities have local taxes which are based of the gross income while other cities are a flat rate that has to be paid yearly. A perfect example is Los Ángeles which requires any company or sole prop to pay a tax based on their gross income while a few miles away in Burbank the city license is a flat fee.
Once we have the business license and city tax compliance in check we can then begin to plan on which type of entity would be most beneficial tax wise, but most importantly we can make the selection to stay within compliance with the local compliance. Working with a new company we just recently had no choice, but to form a corporation because the health department would only assign licenses to this entity class.
Where ever you’re thinking about establishing a business it’s critical to make sure you’re always within compliance. This will save you lots in cash and give you peace of mind. You should always set a reminder in your calendar because the renewal notices are sometimes lost in the mail and there is usually a deadline within some of these cities. In Los Ángeles you have 3 months from start to register your company and if your gross receipts are within their small business exemption requirements you’ll be able to renew your license for free. There are also other exclusions that some companies can benefit from. This is another reason to do your research prior to setting shop.