How to get a liquor license in California
Getting a liquor license can open up a significant opportunity for business owners. The profit margin for liquor sales is one of the largest, at 75% to 80%. However, before you can tap into that market, you must have a liquor license.
You’ll need to jump through a few hoops to get one. For example, suppose you’re opening a restaurant, bar, or liquor store to sell alcohol in California. In that case, you must be at least 21, have the right insurance (such as restaurant and bar insurance), check for proper zoning, and have a business license and seller’s permit.
Different types of California liquor licenses exist, and the requirements and laws can vary by location. Your nearest California Department of Alcoholic Beverage Control office can offer resources to guide you through the process—but here’s what you need to know to get started.
California liquor license requirements and laws
A California Alcohol Beverage Control (ABC) license isn’t an instant process. From start to finish, a new license can take about 90 days. Transfers are slightly faster at around 75 days.
Along the way, you’ll encounter numerous requirements:
- Formal license application process
- Fees for new licenses and renewals
- Federal and local permits
- Zoning regulations
In many ways, the process is the same no matter where you live. But local zoning and regulations can impact the licenses and permits you may need.
What does the location of your business have to do with an ABC license? A lot, actually. Your license (and your liquor liability insurance) is issued as much to the location as it is to you. So, your license requirements can vary if you’re in Fresno vs. San Diego or Los Angeles vs. Sacramento.
For example, your premises will require an inspection as part of the process, and local zoning laws may be in effect that conflict with your ability to get a license.
Because California requires licensees to have a seller’s permit for sales tax, you must apply for a seller’s permit before requesting a liquor license.
Selling alcoholic beverages without one is a misdemeanor in the state of California—that could mean incarceration or fines or both. So, you don’t want to skip this step.
To make it easier, the California Department of Tax and Fee Administration has an online services portal to help you apply.
The Board of Equalization
The California State Board of Equalization (BOE) helps to oversee the alcoholic beverage tax program. The program is a per-gallon tax on the sale, distribution, or importation of alcoholic beverages that you should become familiar with.
For non-retail liquor licenses—if you plan to sell wholesale to stores, restaurants, and shops—you must register with the BOE.
Federal permit and stamp tax
The sale of alcoholic beverages is carefully regulated in the U.S. and may require a federal permit or stamp tax. You can file with the Alcohol and Tobacco Tax and Trade Bureau (TTB), but they must approve your application before you start selling liquor.
This is one of the few instances where you won’t pay a fee to get approval. There’s no cost to apply or maintain approval from the TTB to run your business at the federal level.
The TTB has a streamlined online application. First, determine your permit type and business type using the provided descriptions on the site. Then visit Permits Online to complete and submit your application electronically. The TTB site states the process takes “a matter of minutes,” so you won’t need to set aside a significant amount of time for this step.
Besides federal requirements, you may have specific county or city laws to follow. For example, you may need small business insurance or retail insurance, and the guidelines can be different if you live in Los Angeles, San Francisco, or Sacramento. Your local officials should be able to answer your questions and guide you to any required business licenses.
You may also need to check with local zoning regulations. The census tract report can show you the concentration of liquor sale licenses in and around where your business is located. In addition, you may need a special permit—such as a Conditional Use Permit—before your liquor license can be issued.
Transferring a license
Different guidelines can apply if you buy an existing business or transfer an existing license compared to starting a new business.
For a business operating under a retail license, you must establish an escrow for the full purchase price to do a license transfer. The escrow agreement must indicate that payment is allowed only after the Department of Alcoholic Beverage Control approves the liquor license.
You’ll need to also submit a formal notice to your local County Recorder as part of the transfer process. This applies whether you’re transferring a license for off-sale (for selling alcohol to be taken off-site for consumption) or on-sale (for selling alcohol to be consumed on-site).
Renewing your California liquor license
Every 12 months, you must renew your license. You’ll need to pay the renewal fee on or before the last day of the month it expires.
Like the application process, renewal isn’t instant. You can receive your renewal license about 4 to 6 weeks after your current license expires.
Types of California liquor licenses
Several types of licenses are available, depending on the kind of business you intend to operate and the category of liquor you want to sell. For example, a company that sells directly to the public needs a different license than one that manufactures or distributes alcoholic beverages.
California has 75 ABC license types among 3 main categories:
- Manufacturers such as breweries and wineries
- Distributors who sell to wholesalers and importers
- Retailers who sell to their customers
You can view a full catalog of liquor licenses on the California Department of Alcoholic Beverage Control website, but here are the 3 most common:
- Beer and wine license for restaurants: Liquor license type 41 is the “On-Sale Beer and Wine - Eating Place” license. It authorizes you to sell beer and wine only for customers to enjoy on or off your business property if you’re a bona fide eating place (regularly serving meals to patrons).
- Beer, wine, and distilled spirits for restaurants: Type 47 is a license for an “On-Sale General - Eating Place.” If you have a bona fide eating place, it lets you sell beer, wine, and hard liquor on the premises, and sell beer and wine off the premises, too.
- Beer, wine, and distilled spirits for bars and nightclubs: With this license, you can sell beer, wine, and distilled spirits for customers to enjoy on-location, and beer and wine only for off-site consumption. Food service isn’t required for the type 48 “On-Sale General - Public Premises” license.
Before picking your type of license, consider the kind of alcohol you’ll want to serve. California ABC liquor licenses can include hard alcohol (general) and beer and wine sales only (non-general).
Also, think about whether you want to serve alcohol for consumption on or off the premises. For example, to serve distilled spirits that your customers can enjoy off-site, an off-sale general license may be best.
Can I get a one-day liquor license in California?
Yes, you can get a one-day liquor license in California. This can come in handy for special catering events and other occasions where you want to serve alcohol for a limited amount of time.
You can choose between a general or non-general license depending on if you want a full liquor license to serve hard liquor or beer and wine only.
You can apply 10 to 30 days in advance, and the California Department of Alcoholic Beverage Control has a separate application for daily license authorization. You must also get permission from the property owner where you plan to serve customers. You may also be required to submit a diagram of the event location and get police department approval.
How much does a California liquor license cost?
How much you pay for a liquor license in California depends on the type of license, purpose, and miscellaneous fees for services you may need.
The California Department of Alcoholic Beverage Control has a complete application fee schedule you can view. However, here are the common costs you may encounter:
- Most non-general application fees for new licenses are $905
- Person-to-Person transfer costs range from $100 to $1,250
- Temporary permits are $100
- Daily licenses are $50, $75, or $100 per day, depending on the type you need
Remember: The specifics of acquiring a liquor license vary by state, county, and the local area. Contact the California Department of Alcoholic Beverage Control to determine what kind of liquor license is best, and ask your local officials about business licenses or permits you may need.
You might encounter many obstacles, and it may take a few weeks to several months to get your license. But a business essential that is quick and straightforward is liquor liability insurance. Go to Huckleberry to get an insurance policy in minutes (plus, the whole process is online!)