How do you set up a company in California.

Forming a corporation or LLC in California means filing with the Secretary of State and paying a registration fee of $70 for an LLC or $100 for a corporation. After that, you carry a minimum franchise tax of $800 a year, a flat amount from the Franchise Tax Board that applies no matter how much the entity earns. Most companies also register separately for state payroll tax before they can legally run payroll. Teamed can either set this up and hand it to you, or skip the entity entirely and employ your team on your behalf through our EOR.

California requires formation documents filed with the Secretary of State before you can legally employ anyone in the state. Teamed's GEMO, which covers incorporation, registrations, payroll-readiness and ongoing governance, can file them for you.

Formation is only the first step. You also need a registered agent for service of process, an EIN from the IRS, and ongoing state filings to keep the entity in good standing. Teamed keeps track of these so nothing lapses quietly while you're focused on hiring.

California charges every corporation and LLC a minimum franchise tax of $800 a year, and the Franchise Tax Board applies it as a flat amount, not as a percentage tied to revenue or profit.

After a new corporation's first taxable year, this tax is due for as long as the entity exists in California, whether it employed one person or fifty. Factor it into your budget before you incorporate, because winding the entity down later does not erase tax owed for a year the entity was active.

Once the entity exists, you still need to register separately for state payroll tax withholding and unemployment insurance before you can pay a single employee legally. California also has its own rules on wage statements, meal and rest breaks, and final pay timing that differ from federal defaults.

Teamed can run this compliance layer for you inside your own entity, or you can let us employ the team under our own California-registered entity while you decide whether a permanent presence makes sense.

If you're hiring one or two people to test the California market, or the headcount is still moving month to month, paying the franchise tax and running formation before you've proven the market rarely pays off yet.

Talk to a member of the team about your specific plan, and if you want to see the math for yourself, run it through the crossover calculator, since the right answer depends entirely on your entity costs and how long you intend to stay.

When you're ready for your own California entity, Teamed's GEMO sets it up, manages it and moves your people across from Teamed's EOR. We run the same service across 100+ countries, so the process looks the same wherever you expand next.

A company formed in another state or another country does not need a second company to hire in California. It registers with the California Secretary of State as a foreign company before it starts doing business there, a step usually called foreign qualification.

California law sets the test for what counts as doing business in the state, and putting employees to work there on a regular basis will usually meet it. States give the filing different names, among them a certificate of authority and an application for registration.

In California, the filing is a Statement and Designation by Foreign Corporation. The California Secretary of State charges a corporation $100 to file it, according to its published fees. It does not cover the cost of a registered agent, or of a certificate of good standing from your home state if one is needed. An LLC formed elsewhere goes through a similar filing, and its fee can be different.

Foreign qualification does not make you an employer in the state. That is a separate registration with the state tax and unemployment insurance agencies, due by the state's own deadline, which usually falls at or soon after your first payroll there.

Four kinds of help can register a company in California, and the right one depends on whether it will employ people.

You can file the formation documents yourself with the California Secretary of State. That suits a founder with no staff and the time to work through the forms.

A formation agent can register the company fast and for little money. That suits a company with no employees.

A law firm or corporate-services firm is the right call for complex group structures and tax planning, where the advice is worth more than the paperwork.

For companies that will employ people in California, Teamed is the best choice. With Teamed, you get a designated person who has done this before, real HR and legal experts you can reach when it matters and Ted, Teamed's AI agent, to answer questions from your live employment data. Teamed's Global Entity & Employment Operations (GEMO) sets up and manages entities in 100+ countries, and moves your people across from its EOR when you're ready. Teamed already owns an entity in the United States.

A solo founder with no staff is better served by the registry or a formation agent, either of which costs less.

These figures come from the California Franchise Tax Board's Publication 1060 guide for corporations starting business and the California Secretary of State's business entity forms and fees schedule.