Business License FAQ

Business License Tax is an annual tax for doing business within the incorporated area of the City of Foster City. The Foster City Municipal Code requires that you obtain a business license when you conduct any business activity within the City - even if your business is located OUTSIDE the city limits or you have a business license from another city.

Per Municipal Code 5.24.010, the following tax rates apply:

•   A minimum of $200.00 for gross receipts between $0.00 and $267,000 for general contractors or a minimum of $100.00 for gross receipts between $0.00 and $133,500      for all other businesses;
•  0.075% ($0.75 per $1,000) for gross receipts between $133,500 and $4,400,000;
•  0.088% ($0.88 per $1,000) for gross receipts between $4,400,001 and $8,500,000; 
•  0.1% ($1.00 per $1,000) for gross receipts between $8,500,001 and $12,650,000; 
•  0.113% ($1.13 per $1,000) for gross receipts between $12,650,001 and $16,750,000;     
•  0.125% ($1.25 per $1,000) for gross receipts between $16,750,001 and   $20,900,000;
•  0.138% ($1.38 per $1,000) for gross receipts between $20,900,001 and $25,000,000;
•  0.3% ($3.00 per $1,000) for gross receipts over $25,000,000.

The tax calculator below can help calculate your estimated taxes.

Tax Calculator

A business license is required in the City of Foster City when one of the following occur:

• Conducting any kind of business within the City of Foster City.
• Have a fictitious business name certificate registered using Foster City address.
• Have a State Board of Equalization resale permit registered using Foster City address.
• Have a listing in the Commercial Directory Yellow Pages, Business White Pages, the newspaper, local business guides, real estate multiple listing books, internet, or any other similar listings.
• Have a home-based business.

Always check with the Planning Department at (650) 286-3232 or planning@fostercity.org to ensure that your business is permissible in the location you are considering, this includes home occupations.

Appropriate permits and/or approvals from Planning, Building, Police and/or any other department of the City may have to be secured before your business may start. All applicable federal, state, county and city laws, ordinances or regulations must be followed before your business may start.

Complete the Business License Application and return to the HdL Business Support Center. Support hours are 8am – 5pm, Monday – Friday. A completed application can also be returned to us via email at fostercity@hdlgov.com or fax it to 909-348-0465.

It usually takes up to 24 hours to process the completed application. By then, you should receive an email from us either requesting more information, or with the balance due invoice to pay. You should receive your Business License Tax Certificate by email within 24 hours once the payment has been made. Business license tax fees are non-refundable.

Every business must meet zoning requirements to ensure that the business activity and site are compatible. BEFORE SIGNING any lease or rental agreement, we suggest that you check with the City's Planning Department to make sure your business activity is appropriate for the area's zoning, and it will not require a public hearing or special parking considerations. Call (650) 286-3232 for additional information.

The business inspection fee is a one-time fee of $295.00.

Attached is the City's 2025 Master Fee Schedule for reference.

HdL, the contractor that provides tax administration services on behalf of the City, is currently reaching out to businesses that may be out of compliance with the City’s business license tax laws.  In order to encourage voluntary compliance, the City also recently approved a temporary amnesty program that waives penalties for a limited time for any past business license taxes due, provided that the business comes into compliance during the amnesty period.

The business license tax amnesty program is a temporary initiative to encourage our businesses to be compliant with local tax laws. Under this program, the City will waive penalties on past-due business license taxes so long as the full balance is paid within 60 days of the initial notice from HdL.  Because penalties under the business license tax law are substantial and add up over time, this temporary program offers a limited opportunity for businesses to settle outstanding tax obligations without paying a penalty.

You may have received a notice if you recently closed a business and did not officially notify the city, were unaware that your business is subject to tax, or additional information is needed to determine whether your business is exempt from the tax. Please contact HdL to explain your situation.  They will review your case and determine if you have a tax obligation or if your business qualifies for an exemption. 

HdL contact information: 

Website: https://fostercity.hdlgov.com/

Email: fostercity@hdlgov.com

Phone: (650) 331-2802

This tax has been in place since 1971 and applies to all business operating from or providing services in Foster City.  The voters of Foster City also recently approved changes to the tax structure to make it more progressive. Under the new structure, businesses with higher gross receipts pay a higher percentage in tax . More information is available at www.fostercity.org/finance/page/tax.

The City understands that some businesses may be facing financial challenges. To help, the City approved a temporary amnesty program that waives all penalties on unpaid taxes, so the total liability to business owners has been significantly reduced.  However, if you are unable to pay the full amount, there are options to make partial payments towards your business tax.  Please contact HdL directly to discuss your situation and explore payment options.

These tax dollars go to the City’s General Fund, which helps pay for and support essential services that benefit the entire community. These services include police, fire, parks, community facilities, streets and sidewalks and other vital City operations. 

There are various instances where only a portion of your business activity may be applicable to your Foster City business tax. Please provide as much information as possible on your application for an accurate assessment of your taxes owed. HdL will be able to assist if there are any additional details that need to be discussed.