You should take into account a few fundamental legal issues before opening a food-related business in California. For instance, you must choose a business structure, apply for permits and licenses, learn about food safety, and obtain insurance.
You must also be aware of the foods that you are permitted to prepare in your home kitchen under California’s cottage food law. You must be aware of the regulations if you wish to hire an employee. In this article, we will be looking at all you need to start any of the food operations that do not need permits In California.
Foods like baked dishes without custard, cream, or meat fillings are among those that are authorized (including slices of bread, biscuits, churros, cookies, pastries, and tortillas)
dried baking mixtures
-candy, such as nut brittle or toffee
-nonperishable goods wrapped in chocolate, such as almonds and dried fruit.
-fruit tamales, fruit pies, and fruit empanadas
-cereals, trail mixes, and granola
– dried mole paste and herb mixtures
jams, jellies, preserves, and fruit butter that adhere to the standard outlined in Part 150 of Title 21 of the Code of Federal Regulations. -honey and sweet sorghum syrup.
-nut jars of butter and nut mixtures
dry pasta and popcorn
-waffle cones and pizzelles; -vinegar and mustard; -roasted coffee and dry tea;
In California, a license from the county health department is required to run a home-based food business.
Depending on whether you wish to sell products directly to clients or through other nearby businesses like shops or restaurants, you can select between two types of licenses.
Class A Permit: If you intend to sell just directly to customers inside the state of California, you can obtain a Class A permit there.
With a Class A permit, you can conduct business at farmers’ markets, events, from your house, or in other settings where customers can buy directly from you.
There will not be a physical inspection of your kitchen, but you must complete a self-certification checklist to obtain a Class A permit.
Class B Permit: If you wish to sell to customers indirectly—through shops, eateries, or other establishments that will sell your goods for you—you need a Class B permit.
In California, unless the county where you want to sell has officially specified that they will allow indirect sales of cottage food items, you may not sell indirectly outside of your county.
Your kitchen must pass an annual physical inspection to obtain a Class B permit.
The General State Requirements for Licensing Restaurants Include the Following:
1. Business License
The city or county where you run your bar, restaurant, or food truck issues the business license. To find out if there are any additional conditions you need to meet before starting your business, you must contact the city.
A small company development center in the city is a good place to go if you want more detailed information.
2. Employer Identification Number (EIN)
Your federal identification number, or EIN, is required for all paperwork, reports, and tax-withholding arrangements for your staff members.
You can pay estimated taxes using this number as well. It’s simple to apply for an EIN, often known as a tax ID number, and there are no application fees. Irs.gov accepts applications for the number.
3. Health Permit
Depending on local laws, there are different procedures and expenses involved in applying for a health permit to run a bar, restaurant, or food truck in California.
A general summary won’t work because each city has its building codes, fire department rules, and police department policies.
You must get in touch with your community’s Department of Environmental Health. The San Francisco County Health Department’s management of health permits is a prime illustration.
Health permits in San Francisco County range in price from $904 to $1,365. Bars that serve food must pay $978 for their health permits, while those that don’t must pay $772.
After modifying a facility for your business, there are additional fees if you need to get an inspection and a new Certificate of Occupancy certificate.
Other health districts in California impose comparable fees, but you must confirm the specifics.
No matter which California health district is in charge of your restaurant’s health license, you will still need to apply, get your facility authorized, and get food handler certification and cards.
A $207 non-refundable application fee is required to submit planned changes when rebuilding a facility for food service, according to cdph.ca.gov.
Food Safety Certifications in California
The state of California mandates that the proprietor, manager, or other designated employee of each restaurant be held accountable for the quality of all food provided both on and off the premises.
In California, the designated food handler can be prepared with the necessary knowledge to pass the test by enrolling in third-party and health department-sponsored food manager training classes.
On www.cafoodmanagers.com, you can check out the courses that are offered and their prices. The range of costs is $55 to $135.
A food handler card is required for every current and future employee of your bar, restaurant, or food truck to complete a course and pass an exam. A list of ANSI-approved courses can be found at ansi.org.
Within 30 days of their hire date, new employees must get their cards. The validity of food handler cards is three years.
If you’re buying an existing restaurant, obtaining a health permit in California can be very simple; however, if you’re remodeling a facility, don’t have restaurant expertise, or have inexperienced staff, it can be challenging.
4. California Seller’s Permit
In addition to obtaining the necessary regional permits, you also need to register your company with the state of California using the seller’s permission.
By registering your company with the state, you can collect sales tax on the products and services your restaurant offers, such as catering.
You can purchase food to resell without paying state sales tax or submitting state income taxes or other records by using your seller’s ID number.
Online, over the phone at 800-400-7115, via mail, or in person at one of the state’s Board of Equalization offices are all acceptable methods of application for a seller’s license.
The state may ask you to submit a deposit against future taxes if you owe any back taxes, but there is no price for registering.
On the website www.cdtfa.ca.gov, you can submit an online application for a seller’s license.
5. Fictitious Business Name
To open a company bank account and be legally recognized in court as a legitimate business entity, you must register your restaurant, bar, or food truck name with the state. At businessportal.ca.gov, you can register your fictitious business name.
If you use your legal names, such as O’Neil’s, Jerry Pasternak’s, or the last names listed on a partnership, you do not need to register a fictitious name.
It wouldn’t be necessary to register a fictitious business name for Lagasse and Puck. Dewey, Chokum, and Howe would be ideal names for a restaurant owned and operated by three people with those last names in a legal sense, but hopefully, they aren’t descriptions of the patron experience.
The strange name, however, might be appropriate for a restaurant catering to those with a dry sense of humor.
Unless you are widely recognized in the culinary community, using your name as a branding approach for a new restaurant is not recommended.
Whatever made-up name you decide on, you must do your research to check if it’s already in use in the city or state.
On the website businessportal.ca.gov, you can accomplish that. A notice stating your intention to conduct business under a fictitious name must also be placed in the local newspaper for four weeks in a row.
In California, registering a fictitious business name costs $26 for one name and one owner. It costs $5 per name and registrant (business associate).
Partnerships and sole proprietorships are subject to these costs. You must apply for renewal before the existing license expires because the license is valid for five years. In addition, publishing the notice in a local newspaper costs money.
For a company, you do not need to apply a fictitious business name; nevertheless, other registration requirements are often handled by your incorporation lawyer.
6. Mobile Food Facility Permit (Food Trucks Only)
Some counties and towns need you to have a mobile food facility permit since food trucks are growing more and more popular.
These licenses typically have restrictions on business hours, particular areas, packaging, and — most crucially — garbage disposal.
Each city has its own set of regulations and application procedures. Searching for “*Your county/city* Mobile Food Facility Permit Application” on Google is a fantastic approach to learning what works for your particular city or county. Visit any “.gov” or “.org” website to learn what you must do.
For example, Contra Costa – https://cchealth.org
7. Liquor Licenses in California
Unless you intend to create a juice, coffee, or tea bar, you must obtain the proper type of liquor license for your restaurant or bar. Alcohol cannot be served from a food truck in California.
There is a workaround; you can offer alcohol in a private setting with items that are delivered by truck together with food and drinks.
How Much Does A Food Permit Cost?
Permit for food service: $250 to $1,000 annually. $125 to $150 for a fire safety permit yearly. $250 to $500 annually for a license or permit for a food truck.
While some goods in California may be sold without a license, none may be sold without a permit.
Without first acquiring a license from the city, it is illegal for any vendor to sell, exhibit, or offer for sale any food, beverages, products, or items.
The Difference Between A Permit and A License
Permits are the legally binding documents that an authority releases or issues as authorization to carry out a specific activity or conduct business.
It merely symbolizes authorization. For instance, a permit is required to keep chemicals and other dangerous liquids for those who operate a pest management firm.
Licenses serve as legal proof that something can be done or used. It functions as a legally binding agreement containing terms and requirements that permit someone to perform an action or utilize a service.
A license is typically granted to individuals or entities performing certain professional services that have the potential to cause harm to others. They are mostly used to control a variety of activities.
Cottage Food Operations (CFO) is the most well-known of California’s many food businesses. Cottage cuisine is homemade meals made by a single person or a small group of people.
Food Operations that do Not Need Permits In California
If you are looking for food operations that do not need permits In California, then you must know that only prepackaged goods can be sold in California without a license or authorization.
Pre-packaging is primarily used for food, which is filled and sealed without the ability of the consumer to verify it or demonstrate compliance with packaging rules.
The quantity or quality of the packaged product cannot be altered without opening the package or doing other obvious manipulations.
Any food that has been packaged prior to the sale is referred to as prepackaged food. Food items may be partially or completely enclosed in packaging, which indicates that the product cannot be changed without opening or replacing the packing and is therefore ready for sale.
Bread is one example of pre-packaged food. Crackers for BLATs (Bacon, Lettuce, Avocado, and Tomato Sandwiches). More examples of food operations that do not need permits In California are:
- Veggie burgers from frozen.
- Nut Butter & Nuts.
- Energy bars.
- Beans in cans.
- Fruits & Vegetables in Freeze.
Neither a kitchen inspection nor the possession of a food handler’s license is necessary to purchase prepackaged food and resell it.
However, if you make and package the food, the location will need to be inspected for health and safety violations following any applicable local legislation. What are your thoughts about these food operations that do not need permits In California? Please share your thoughts with us.