How to Start a Cleaning Business in California: Complete Guide

Starting a cleaning business in California typically costs $1,000 to $5,000 depending on your business structure and insurance needs. Each state has different rules for registration, taxes, and workers' compensation. This guide covers everything you need to start a cleaning business in California, including filing fees, licenses, insurance, labor laws, and local tips.

Why Start a Cleaning Business in California?

California has almost 40 million people. That makes it the most populated state in the country. More people means more homes, offices, and buildings that need cleaning. The demand for cleaning services in California is huge and keeps growing.

California also leads the country in demand for green cleaning. Many residents want eco-friendly products used in their homes. This means you can charge higher rates if you offer green cleaning services.

But California has more rules than most states. You need to know about special registrations, higher taxes, and strict labor laws. This guide covers every California-specific step so you can start the right way.

How Do You Choose a Business Structure?

The first thing you need to decide is how to set up your business. California offers two main choices for new cleaning companies.

Sole Proprietorship

This is the simplest way to start. You do not file anything with the state. California considers you a sole proprietor the moment you begin doing business.

You may want to use a business name. If so, you must file a Fictitious Business Name Statement. File it with your county clerk within 40 days. You also need to publish a notice in a local newspaper. Run the notice for four weeks in a row. You renew this every five years.

The downside is that you have no personal protection. If something goes wrong, your personal savings and belongings are at risk.

Limited Liability Company

A limited liability company is the better choice for most cleaning businesses. It keeps your personal money separate from your business. If a client sues your business, your personal savings stay protected.

To form one in California, file Articles of Organization. You do this through the Secretary of State website. The filing fee is $70. You must also file a Statement of Information within 90 days. That costs $20 and you file it again every two years.

California law says you must have a written operating agreement. You do not file this with the state, but you need to keep it on record.

How Do You Get an Employer Identification Number and Tax Accounts?

An Employer Identification Number is a free number from the federal government. You need it to open a business bank account, file taxes, and hire workers. Apply for free at the Internal Revenue Service website. You get your number right away when you apply online.

California Franchise Tax

Every limited liability company in California must pay an annual franchise tax of $800. This is due on April 15 each year. You pay this to the California Franchise Tax Board. It does not matter how much money your business makes — you owe $800 every year until you cancel your limited liability company.

If your business makes more than $250,000, you also pay extra fees based on your income. These range from $900 to $11,790 depending on how much you earn.

Cleaning Services and Sales Tax

Good news for cleaning businesses: cleaning services are not subject to sales tax in California. Both home cleaning and office cleaning count as services, not products. You only need to collect sales tax if you sell physical products to clients. If you only provide cleaning services, you do not need a seller's permit.

What Licenses and Permits Do You Need?

California does not have one statewide business license. Instead, you need a local business license from your city or county. Fees range from $15 to $100 or more depending on where you live.

The best way to find out what permits you need is to use CalGold. This is a free tool from the state. You enter your business type and location. It tells you every permit and license you need from the city, county, state, and federal level.

Janitorial Employer Registration (Required)

This is one of the biggest rules in California that many new cleaning business owners miss. California has a law called the Property Service Workers Protection Act. It says all cleaning companies with employees must register. You register with the California Labor Commissioner's Office.

The registration fee is $500 per year. It does not get refunded if you close your business. You must also provide in-person sexual harassment prevention training to your workers every two years.

If you work without this registration, you face fines and stop-work orders. Businesses that hire unregistered cleaning companies can also face penalties.

What Insurance Do You Need?

Insurance protects you from one bad day ending your business. California has strict rules about certain types of insurance. Here is what you need:

• General liability insurance — Covers property damage and injuries at a client's home or office. Costs $400 to $1,200 per year. Every cleaning business needs this
• Workers' compensation insurance — Required by California law the moment you hire your first employee. The penalty for not having it is $1,500 per uncovered worker plus a stop-work order. Average cost is around $486 per month
• Surety bond — Protects clients if an employee steals something. Not required by the state, but many clients and property managers will ask for it. Costs $100 to $500 per year
• Commercial auto insurance — Needed if you use a vehicle for business. California minimum coverage is $15,000 per person and $30,000 per accident for injuries, plus $5,000 for property damage

For more details on each type of coverage, read our Cleaning Business Insurance Guide.

What Are California Labor Laws?

California has some of the strictest labor laws in the country. If you plan to hire workers, you must follow these rules from day one.

Assembly Bill 5 and the Three-Part Test

California passed Assembly Bill 5 to stop companies from wrongly calling workers "independent contractors." The law uses a strict three-part test. It decides if a worker is an employee or a contractor.

Cleaning businesses are not exempt from this law. Your cleaners almost always fail the test because cleaning is the main work of your business. This means you must hire cleaners as employees, not independent contractors.

Breaking this rule leads to large fines and back-pay penalties. Do not try to save money by calling employees independent contractors.

Minimum Wage

The California state minimum wage is $16.50 per hour. But many cities set their own higher rates. You must pay the higher of the two rates. The rate depends on where your employee works. It does not matter where your business is based.

Here are some notable local minimum wages:

• San Francisco — $18.67 per hour
• San Jose — $17.95 per hour
• Los Angeles (city) — $17.28 per hour
• Berkeley — $18.67 per hour
• Mountain View — $18.75 per hour

Check your city's website for the current local rate. These amounts go up every year.

Employer Taxes

When you hire employees in California, you pay state employer taxes through the Employment Development Department. These include:

• Unemployment Insurance — 1.5% to 6.2% on the first $7,000 each employee earns per year. New employers pay 3.4%
• Employment Training Tax — 0.1% on the first $7,000 per employee per year
• State Disability Insurance — 1.3% on all wages with no cap. This is withheld from employees' pay

What Safety Rules Apply in California?

California has its own workplace safety agency. It is called the Division of Occupational Safety and Health. It has tougher rules than the federal version. As a cleaning business owner, you need to follow these key requirements.

Hazard Communication Program

You must keep Safety Data Sheets for every cleaning chemical you use. Train your workers on what chemicals they handle, how to use them safely, and what to do in case of a spill or skin contact. This training must happen before they start using any product.

Injury and Illness Prevention Program

Every California employer must have a written Injury and Illness Prevention Program. This is a simple document that explains how you keep workers safe. It covers things like how to report hazards, how you investigate injuries, and how you train workers on safety.

Proposition 65

California's Proposition 65 lists over 900 chemicals that may cause cancer or birth defects. Some cleaning products contain these chemicals. If you use products with listed chemicals above safe levels, you must give clear warnings to anyone who might be exposed.

The safest approach is to use green cleaning products that do not contain Proposition 65 chemicals. This also appeals to the many California clients who prefer eco-friendly cleaning.

How Do You Set Cleaning Prices in California?

California's high cost of living means you can charge more than in most states. But you also have higher costs to cover. Factor in the $800 franchise tax, $500 janitorial registration, higher minimum wages, and mandatory insurance.

Typical pricing ranges in California:

• Home cleaning (hourly) — $35 to $70 per hour depending on your city
• Home cleaning (flat rate) — $150 to $400 for a standard 3-bedroom home
• Deep cleaning — $250 to $550 depending on home size and condition
• Move-in or move-out cleaning — $300 to $600 or more
• Office cleaning — $0.07 to $0.20 per square foot, or $30 to $75 per hour
• Vacation rental turnover — $75 to $150 or more per turnover

Prices at the high end of these ranges are common in the Bay Area, Los Angeles, and San Diego. Prices at the lower end are more typical in the Central Valley and smaller cities.

Use our Price Calculator to find the right rate for your area. For detailed pricing methods, read our Pricing Guide.

What Cleaning Niches Are Profitable in California?

California has some cleaning niches that do especially well because of the state's unique market. Here are the top options:

Green and Eco-Friendly Cleaning

California leads the country in demand for green cleaning. Many residents care deeply about the environment and will pay more for non-toxic products. You can charge 10 to 20 percent more for green cleaning. This niche also helps you avoid issues with Proposition 65 chemicals.

Vacation Rental and Airbnb Turnover Cleaning

California is one of the top vacation rental markets in the country. Cities like Los Angeles, San Francisco, San Diego, Palm Springs, and Lake Tahoe have thousands of short-term rental properties. Hosts need fast, reliable turnover cleaning between guests. You can earn $75 to $150 or more per turnover. The work is steady and often last-minute, which means less competition.

Post-Construction Cleaning

California has a large construction industry. New homes and remodels need thorough cleaning before owners move in. This specialty pays well — $100 to $500 or more per job. It requires extra skills but faces less competition than standard home cleaning.

Move-In and Move-Out Cleaning

With California's high turnover rental market, move-in and move-out cleaning stays busy year-round. Property managers need these services regularly. Build relationships with a few property management companies, and you will have a steady flow of work.

How Do You Market a Cleaning Business in California?

Getting clients in California follows many of the same steps as anywhere else. But a few strategies work especially well here.

Google Business Profile

This is the single most important free marketing step. Set up your Google Business Profile with your city name, services, hours, and photos. Ask every happy client for a Google review. Most people in California search online before hiring any service.

Nextdoor and Local Facebook Groups

California residents are very active on Nextdoor and local Facebook groups. Join groups for your service area. Share helpful cleaning tips. When someone asks for a cleaner recommendation, your name will come up. Do not spam — focus on being helpful first.

Partner with Real Estate Agents and Property Managers

California has a huge real estate market. Real estate agents need move-out cleaning for listings. Property managers need regular cleaning between tenants. Offer them special rates or a referral bonus. One good partnership can keep you busy for months.

Thumbtack and Yelp

Both platforms are popular in California for finding local services. Thumbtack lets homeowners request quotes directly. Yelp reviews carry a lot of weight in California — claim your profile and respond to every review.

For a complete marketing plan, read our Marketing Your Cleaning Business guide and How to Get Cleaning Clients Fast.

How Much Does It Cost to Start in California?

California is more expensive to start a cleaning business in than most states. Here is a breakdown of what to expect:

• Limited liability company filing — $70 (one-time, through the Secretary of State)
• Statement of Information — $20 (every two years)
• Annual franchise tax — $800 per year (to the Franchise Tax Board)
• Janitorial employer registration — $500 per year (only if you have employees)
• Local business license — $15 to $200 per year (varies by city)
• General liability insurance — $400 to $1,200 per year
• Workers' compensation insurance — Around $486 per month (only if you have employees)
• Cleaning supplies and equipment — $200 to $500 to start
• Marketing (initial) — $100 to $500

What Is on Your California Startup Checklist?

Here is a step-by-step list to follow. Complete each item before moving to the next:

1. Choose your business structure — Form a limited liability company at bizfileOnline.sos.ca.gov ($70)
2. Get an Employer Identification Number — Apply free at irs.gov
3. Open a business bank account — Keep personal and business money separate
4. Use CalGold to find required permits — Enter your business type and city at calgold.ca.gov
5. Get your local business license — Apply through your city or county
6. Buy general liability insurance — Get at least $1 million in coverage
7. Buy cleaning supplies — Start with the basics and upgrade as you grow
8. Set your prices — Use our Price Calculator and factor in California costs
9. Set up your Google Business Profile — This is your most important marketing tool
10. Book your first clients — Tell friends, post on Nextdoor, join Thumbtack
11. Register as a janitorial employer — Do this before hiring your first employee at dir.ca.gov
12. Get workers' compensation insurance — Required before your first employee starts work

What Are the Best Tips for California?

Here are practical tips from successful California cleaning business owners:

• Start solo to keep costs low — California's extra fees add up fast. Work alone until you have enough clients to justify hiring
• Use green products from the start — Many California clients will choose you over a competitor just for being eco-friendly. It also avoids Proposition 65 headaches
• Plan your routes carefully — California traffic can eat into your profits. Group clients by neighborhood and avoid peak traffic times
• Network with property managers — California's huge rental market means steady work from property management companies
• Build vacation rental relationships — Reach out to Airbnb hosts in tourist areas. They need reliable, last-minute cleaning and will pay premium rates
• Keep detailed records — California has more audits and stricter reporting than most states. Track every dollar from day one
• Learn about your local market — Pricing in San Francisco is very different from Fresno. Research what competitors charge in your specific city
• Get your systems in place early — Use software like MaidProfit for scheduling, quoting, and invoices so you can focus on cleaning and growing

Where Do You Find California Government Resources?

Here is a complete list of every government website mentioned in this guide. Bookmark these — you will need them as your business grows.

What Are the Guides for Nearby States?

Thinking about expanding to a nearby state? Each state has different rules and fees. Check our other western state guides below.

What Other Guides Can Help Your Business?

These free guides cover topics every cleaning business owner needs. They work hand-in-hand with this state guide.

Start Your California Cleaning Business Today

California has more rules than most states. But it also has more people, higher demand, and higher prices. The extra work of following the rules pays off with a bigger market and better earnings.

Start by forming your limited liability company and getting your Employer Identification Number. Get insured, find your permits through CalGold, and set prices that cover California's higher costs. Then focus on getting your first clients through Google, Nextdoor, and local partnerships.

Every successful cleaning company in California started with one owner and one first client. The steps in this guide give you a clear path to follow. Take action today.