Cannabis Permits & Licenses in San Diego, California

File in county of principal place of business; publish in newspaper.

Provides fee reductions, priority licensing. Not mandatory.

Required for all LLCs. Online filing available via bizfile.sos.ca.gov. Statement of Information (Form LLC-12) due within 90 days of formation ($20), then biennially ($20).

Applies to all LLCs.

Required for all businesses selling tangible goods, including cannabis.

Required if paying wages over $100/quarter. Register via e-Services for Business.

All LLCs doing business in CA must pay, regardless of income. First year due by 3.5 months after formation.

Specific license type required (e.g., Retailer, Cultivator, Distributor). Prerequisites: local approval, zoning compliance, security plan, track-and-trace (METRC) enrollment, criminal background checks. Full list at URL. Fees effective as of 2023 updates.

Must specify exact activity (18+ types). Local jurisdiction approval prerequisite. Track-and-trace via METRC mandatory. Fees updated Jan 1, 2023.

Mandatory for all commercial cannabis businesses. Register at metrc.com.

All cannabis retailers must obtain a seller's permit from CDTFA to collect and remit sales tax. Applies to tangible personal property and cannabis products sold at retail. Cannabis sales are subject to California's base sales tax rate (7.25%) plus applicable district taxes.

Imposed under California Revenue and Taxation Code Section 34015. A 16% excise tax is levied on the retail sale of cannabis goods to consumers. Businesses must register with CDTFA and file Form CDTFA-525, 'Cannabis Excise Tax Return'.

A per-ounce or per-pound cultivation tax applies to fresh or dried cannabis and extracts. Rates vary by product type. Filers must submit Form CDTFA-501 monthly. Registration required via CDTFA's online system.

All employers in California must register with CDTFA to withhold state income tax from employee wages. Cannabis businesses must comply regardless of federal illegality. Form DE 1 is used for registration.

Employers must register with EDD and pay Unemployment Insurance (UI) taxes on first $7,000 of each employee’s annual wages. Rate varies (typically 1.5%–6.2% in first year). Cannabis businesses are eligible for state UI program participation.

All LLCs doing business in California must pay an annual $800 minimum franchise tax. Due even if no income is generated. First-year exemption may apply if LLC is formed after January 1 and files Form 35366. Ongoing obligation regardless of cannabis status.

Cities like Oakland, Los Angeles, and San Jose impose gross receipts taxes on cannabis businesses. Registration required with city treasurer or tax collector. Rates and thresholds vary. Example: Oakland Business Tax Regulation 5.04.070 imposes tax on cannabis retailers and cultivators based on gross receipts.

All California cannabis businesses must obtain a local business license or tax certificate. Required even if state-licensed. Cities like San Francisco, Long Beach, and Sacramento require separate registration and annual renewal. Fees and requirements vary significantly by location.

LLCs in California are pass-through entities. While the LLC itself does not pay income tax, it must file Form 568 (Limited Liability Company Return of Income) annually. Owners report income on personal returns. Registration with FTB is automatic upon filing first return.

All cannabis businesses must obtain a state license from the BCC. Local jurisdictions may also require additional permits. Licensing is separate from tax registration.

All businesses, including cannabis LLCs, require a city business tax registration certificate. Cannabis businesses must also obtain a separate commercial cannabis activity permit from the Department of Cannabis Regulation (DCR).

Required for all commercial cannabis activities (cultivation, retail, distribution, etc.). See current fee schedule at https://cannabis.lacity.gov/sites/g/files/wph1491/files/2024-04/FY23-24%20Fee%20Schedule.pdf (effective July 1, 2023).

Must comply with Ordinance No. 185,215 (cannabis zoning districts CE, CR, CM). Site must be in approved zone; 100ft buffer from residential/schools. Verified during DCR permit process.

Required for any structural, electrical, plumbing, or mechanical alterations to meet California Fire Code and local standards for cannabis facilities.

Mandatory inspection for cannabis extraction, storage, and retail. Requires NFPA 1 compliance, ventilation, and hazardous materials permits if applicable.

Cannabis businesses subject to strict sign regulations under Los Angeles Municipal Code Sec. 91.6205 (no cannabis leaf imagery; limited size/location).

Required for all commercial alarms; cannabis businesses must meet state security camera and alarm standards (SB 670).

Cannabis retail/microbusiness requires Group M (mercantile) occupancy with fire/life safety approvals.

Cannabis lounges require plan check for ventilation, waste management per LAMC 91.7104.

Mandatory for all employers in California with at least one employee, including part-time and family members. Cannabis businesses are not exempt. Sole proprietors without employees are exempt unless they elect coverage. Enforced under California Labor Code §3700.

Required under DCC regulations for all cannabis licensees. Minimum $2 million in general liability coverage per occurrence. Applies to premises liability, bodily injury, and property damage. Mandated in Title 16, California Code of Regulations § 5022(a)(1).

A surety bond of at least $5,000 is required for all cannabis licensees under Title 16 CCR § 5022(b). The bond ensures compliance with the Medicinal and Adult-Use Cannabis Regulation and Safety Act (MAUCRSA). Required regardless of business size or revenue.

Mandated under DCC regulations as part of the $2 million general liability policy that must cover product liability claims arising from cannabis goods. Required for all manufacturers, distributors, retailers, and microbusinesses. See Title 16 CCR § 5022(a)(1).

Required under California Vehicle Code § 16020 for any vehicle registered to the business or used for commercial purposes. Minimum liability limits: $15,000 bodily injury per person, $30,000 per accident, $5,000 property damage. Higher limits may be required for trucks or fleets. Also enforced by DCC for cannabis transport licensees.

Not currently mandated by California DCC regulations. While strongly recommended for consultants or testing labs, it is not a legal requirement for cannabis businesses. General liability and product liability are the primary mandated coverages.

Not applicable to cannabis businesses unless they also hold an alcohol license. California cannabis licensees are prohibited from co-locating with alcohol sales under Health and Safety Code § 11362.785. Therefore, liquor liability insurance is not required for standard cannabis operations.

All LLCs, including cannabis businesses, must obtain an EIN from the IRS regardless of whether they have employees. This is required for tax administration. However, cannabis businesses face unique IRS scrutiny under Section 280E, which disallows most deductions.

Under 26 U.S. Code § 280E, businesses trafficking in Schedule I or II drugs (including cannabis) cannot claim most business deductions (e.g., cost of goods sold, rent, utilities). This results in effective tax rates of up to 70-90%. Only "cost of goods sold" (COGS) may be deducted under IRS Notice 2015-14. This is a unique federal burden on cannabis businesses despite state legality.

All employers with employees must comply with OSHA standards, including providing a safe workplace, training, and recording work-related injuries. Cannabis businesses are not exempt. Specific hazards may include extraction processes (using flammable solvents), mold exposure, and ergonomics in cultivation. OSHA enforces under the General Duty Clause (Section 5(a)(1) of the OSH Act).

Under the Americans with Disabilities Act (ADA), businesses open to the public must provide equal access to individuals with disabilities. This includes physical access to facilities, communication access, and reasonable policies. Cannabis dispensaries are considered "public accommodations" and must comply, even though cannabis remains federally illegal.

Cannabis cultivation and processing may generate hazardous waste (e.g., ethanol, butane, pesticides). Facilities must comply with RCRA (Resource Conservation and Recovery Act) if they produce more than 220 lbs of hazardous waste per month. Registration with EPA as a hazardous waste generator is required. State rules (CalEPA) may be stricter.

All businesses, including cannabis, must avoid deceptive or unfair advertising under Section 5 of the FTC Act. However, cannabis businesses face additional constraints because federal law prohibits most advertising of cannabis products. FTC may coordinate with FDA or DOJ in enforcement. Claims about health benefits are especially scrutinized.

All employers must complete Form I-9 to verify identity and work authorization for employees. Cannabis businesses are not exempt, despite federal illegality. Employers must use USCIS E-Verify if required by state law or federal contract, though not generally mandated for private employers in California.

FLSA sets federal minimum wage ($7.25/hr), overtime (1.5x after 40 hrs), recordkeeping, and child labor standards. California state law sets higher minimum wage, so state rules prevail. Cannabis businesses must comply with FLSA regardless of federal illegality.

FMLA requires covered employers to provide up to 12 weeks of unpaid, job-protected leave for qualifying medical and family reasons. Applies to cannabis businesses meeting employee threshold, despite federal status. California’s CFRA may provide broader protections.

Cannabis remains a Schedule I controlled substance under the Controlled Substances Act (21 U.S.C. § 812). No federal license exists for commercial cannabis activity. Businesses operating under California law are still in violation of federal law and cannot obtain federal permits. DEA does not issue licenses for recreational or adult-use cannabis. CBD products derived from hemp (≤0.3% THC) may be regulated by FDA.

FDA prohibits the sale of cannabis or cannabis-derived products (e.g., CBD, THC) in interstate commerce for human consumption, except FDA-approved drugs (e.g., Epidiolex). Businesses cannot market cannabis products as dietary supplements or add them to food. FDA enforces against unsubstantiated health claims. This applies even if state-legal.

While cannabis businesses are not required to file federal tax forms beyond standard EIN obligations, financial institutions must file Suspicious Activity Reports (SARs) for cannabis clients under FinCEN guidance (2014). This creates de facto federal reporting exposure. Businesses themselves are not directly required to file SARs, but their banking relationships are subject to intense scrutiny.

While cannabis businesses do not directly file SARs, they must maintain records and cooperate with banks that file SARs. Banks may terminate accounts due to federal risk. This creates a de facto federal reporting burden and limits access to financial services.

FDA prohibits the interstate sale of cannabis or cannabis-derived products for human consumption, except for FDA-approved drugs (e.g., Epidiolex). Products cannot be marketed as dietary supplements or with unsubstantiated health claims. State-legal products may still violate federal law if sold online or across state lines.

Despite federal illegality, all income from cannabis activities is taxable under IRC §61. Section 280E disallows most deductions, increasing effective tax rates to 70–90%. Businesses must file Form 8300 (cash transactions), Form 1120 (corporations), and comply with IRS audit protocols.

Required for all LLCs in California, including cannabis businesses. Must be filed with the California Secretary of State.

All state cannabis licenses must be renewed annually by December 31. Fee is based on the prior year’s adjusted gross receipts. See DCC’s fee schedule for exact amounts.

Local renewal deadlines and fees vary significantly. Examples: Los Angeles requires annual renewal by December 31; San Diego by permit anniversary date. Contact local authority for specifics.

EIN itself does not require renewal, but businesses must file annual federal tax returns using the EIN. Cannabis businesses typically file Form 1120 or 1065.

CA EIN does not expire, but employers must file Form DE-9 (quarterly) and DE-9C (annual wage reporting).

Most cities require annual renewal of general business licenses. Fees and deadlines depend on location and business type.

Responsible Officers must complete DCC-approved training every two years. Initial training required within 30 days of designation.

Required under California Fire Code. Frequency determined by local fire authority. Cannabis facilities often require annual inspections due to storage and occupancy risks.

Ongoing compliance with local building codes. Inspections are typically required during construction phases, not annually unless modifications occur.

Cannabis businesses must collect and remit sales tax. Filings via Form CDTFA-542.

Cannabis businesses must file federal returns despite Section 280E. Most use Form 1120 (C-corp) or Form 1065 (partnership).

All LLCs doing business in California must pay an $800 annual minimum franchise tax, due by April 15, regardless of revenue.

Cannabis businesses must maintain detailed records to support cost of goods sold under Section 280E. Full documentation of all expenses required.

All licensees must use METRC for real-time reporting of cannabis inventory. Daily audits and compliance checks are conducted by DCC.

Required posters include: Minimum Wage, Paid Sick Leave, Sexual Harassment Prevention, Workers’ Compensation, and DCC License Display. Failure to post may result in penalties.

Mandatory for all employers in California. Proof of coverage must be displayed at the worksite.

Employers must file Form DE-9C by January 31 to report prior year wages and unemployment insurance wages.

Employers must file Form DE-9 each quarter to report wages and withholdings.

UI tax rate ranges from 1.5% to 6.2% on first $7,000 of wages per employee annually.

Separate from DCC licensing. Required for hemp growers under California’s Industrial Hemp Program.

Cultivators may need to comply with General Waste Discharge Requirements for Stormwater. Requires annual reporting and inspections.

Businesses that generate hazardous waste must file an annual report with DTSC by March 1.

All records related to cannabis operations (sales, inventory, security, training) must be retained for a minimum of 7 years and made available for inspection.