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How to Start a Hair Salon in Texas: Licenses, Costs & Requirements

Texas does not hand you one salon license and send you on your way. It splits the job into pieces: a license for every person who touches a client's hair, a separate license for the space itself, a state filing for your business entity, and tax accounts with the Comptroller. This guide walks through each piece using the fees, forms and rules published by Texas agencies.

Researched from Texas state sources. Our guides are free. We may earn a commission when you use a partner service, at no additional cost to you.

Who licenses hair salons in Texas

One agency runs nearly all of Texas beauty licensing: the Texas Department of Licensing and Regulation (TDLR), through its Barbering and Cosmetology program. Barbering and cosmetology used to sit in separate chapters of state law until House Bill 1560 in the 87th Legislature, signed June 15, 2021, consolidated them under one program in the Texas Occupations Code, Chapter 1603. Older guides citing the pre-consolidation chapters are outdated. Start from TDLR's Barbering and Cosmetology pages and Chapter 1603.

That single regulator is what makes Texas simpler than most states. The same department licenses your stylists, barbers, estheticians and nail techs, and the salon establishment itself. The rest of your setup spreads across the Secretary of State (entity and trade name), the Comptroller (sales and franchise tax), and the Texas Workforce Commission (employment taxes). Your city and county add a final local layer on top.

Texas hair salon requirements at a glance

Texas licenses for the people who do the hair

Every person who provides a regulated service in your salon must hold their own TDLR license. There is no shared salon license that covers your staff. Texas issues seven license types under the Barbering and Cosmetology program, and one salon may employ several types at once.

The Cosmetology Operator path: you complete 1,000 hours at a licensed school. You become eligible to take the written exam after 900 hours of training, and you must pass both a written exam and a practical exam, administered through PSI, the state's exam provider. The application fee is $50, the minimum age is 17, and the license runs for two years before it renews. TDLR publishes its school and curriculum requirements at tdlr.texas.gov.

Two hiring rules follow from this. First, verify every applicant's license with TDLR before their first shift. An unlicensed person providing services puts your establishment license at risk, not just their own. Second, renewal rules, including continuing education requirements, change over time. Rather than relying on any summary, verify the current continuing education rule on TDLR's site before each renewal cycle.

The salon establishment license for your space

Separate from every individual license, the salon itself needs a TDLR establishment license. TDLR issues four types: Full-Service, Specialty, Mini-Establishment and Mobile. A conventional multi-chair salon is a Full-Service establishment, and a single-service shop fits the Specialty license. The Mini-Establishment license covers small, single-operator style spaces, and it is the license that makes suite style businesses work legally in Texas. The Mobile license covers establishments that operate on the move; TDLR's application guidance is at tdlr.texas.gov.

The fees are modest. A Full-Service establishment license costs $78, a Specialty license costs $78, and a Mini-Establishment license costs $70. Renewal fees match the initial fees, per TDLR's establishment renewal page. The license is tied to a specific owner at a specific address, so a change of ownership or a move means dealing with TDLR again rather than taking the license with you. Expect inspections: TDLR inspects licensed establishments, and your sanitation and record keeping have to hold up on inspection day.

One point surprises many first-time owners: you do not need a practitioner license to own a salon in Texas. Investors and non-stylist owners open salons legally. The requirement is that the establishment is licensed and that every person providing services holds their own individual license. If you plan to work behind the chair yourself, you need the operator license too.

Forming your LLC with the Texas Secretary of State

Most first-time salon owners form a limited liability company so the business's debts and legal problems stay with the business instead of following them home. In Texas you form an LLC by filing a Certificate of Formation, Form 205, with the Secretary of State. The filing fee is $300. Your salon's legal name must include an LLC designator such as "Limited Liability Company" or "LLC", and it must be distinguishable from names already on file. You also need a registered agent with a Texas street address; a post office box does not qualify. An optional name reservation holds a name for 120 days for $40.

Two Texas quirks work in your favor. Texas has no general state business license, so there is no extra state-level license to buy beyond the TDLR licenses above. And Texas LLCs file no annual report with the Secretary of State. Your recurring state filing obligation is the Comptroller's franchise tax report, covered below. The Secretary of State's own instructions walk through every field of Form 205: Texas Secretary of State, Form 205 instructions.

Registering your salon name with a DBA

If your salon will operate under a name different from your legal entity name, Texas calls that name an assumed name and you register it with a DBA filing. Where you file depends on your business structure, and this is the detail out-of-state guides routinely get wrong.

Filing entities, meaning LLCs and corporations, file the Assumed Name Certificate, Form 503, with the Secretary of State. The fee is $25. Sole proprietors and general partnerships file at the county clerk in each county where the business operates, at roughly $15 to $25 per county. A sole proprietor with locations in two counties files in both. A DBA is not a license and does not create your entity; it puts the public on notice of your trade name, and your bank will typically want to see it before opening accounts in the salon's name.

Getting your federal Employer Identification Number

Your EIN is your business's federal tax ID, issued by the IRS. You need one to hire employees, open most business bank accounts, and file business taxes. It is free. Apply directly through the IRS and ignore any website that offers to obtain one for a fee; those sites charge you for a form the government gives away. Apply early, so the EIN never becomes a bottleneck when you sign a lease or set up payroll.

Texas sales tax: services are not taxed, retail products are

Here is the Texas rule that matters most at your register. Beauty services themselves are generally not taxable in Texas. The haircut, the color service, the blowout: no sales tax. Retail product sales are taxable. The take-home shampoo, conditioner and styling products a client buys at the front desk are retail sales, and you collect tax on them.

Set your booking and point of sale system to itemize services and products separately from day one. You need a sales tax permit from the Texas Comptroller before you make retail sales; the permit is free. The tax rate is 6.25 percent state tax plus up to 2 percent in local taxes, for a combined maximum of 8.25 percent. Your exact local rate depends on where the salon sits. You remit what you collect on the Comptroller's filing schedule, and how often you file depends on how much tax you collect.

The Texas franchise tax and the report small salons still file

Texas has no personal income tax, but LLCs and corporations owe the state franchise tax. Most new salons will owe nothing: the no tax due threshold is $2,650,000 in total revenue for 2026, and the same threshold is set for 2027. Above the threshold, the rate is 0.75 percent for most businesses and 0.375 percent for retail and wholesale trades, with an EZ Computation rate of 0.331 percent available up to $20 million in revenue. Rules and current forms: Comptroller franchise tax pages and franchise tax forms.

Hiring staff: unemployment tax, wages and workers' comp

When you hire employees, you register as an employer with the Texas Workforce Commission (TWC) and pay state unemployment tax. The tax applies to the first $9,000 of wages paid to each employee, and the new employer rate is 2.7 percent. Report every new hire within 20 days of their start date. The minimum wage in Texas is $7.25 an hour, the federal rate, and Texas cities are preempted from setting a higher local minimum wage.

Workers' compensation is where Texas genuinely stands alone. Texas is the one state where workers' comp coverage is optional for private employers. You choose whether to carry it. If you choose not to, you are a non-subscriber, and that choice carries duties: file Form DWC-005 with the Division of Workers' Compensation, post the required notices in the workplace, and know that non-subscribers give up common-law defenses if an injured employee sues. Many salon owners still buy coverage voluntarily, because one serious injury claim without it can cost more than years of premiums. Either way, decide deliberately, and file the form if you opt out.

The other employment decision is structural: are your stylists W-2 employees, or independent booth renters who run their own businesses inside your space? The two models carry different tax, control and licensing consequences. A true booth renter sets their own prices and hours, collects their own money and files their own taxes. If you set a stylist's schedule, prices and product lineup, the state is likely to see an employee no matter what your paperwork calls them. Put booth rental agreements in writing, and treat classification as a real legal decision, not a payroll preference.

City zoning, occupancy and local permits

State licenses do not guarantee your location is legal. Your city controls zoning, and a salon has to be a permitted use at the address you choose. Before you sign a lease, confirm with the city that a hair salon can operate in that space, and ask what the build out will require. Most cities issue a certificate of occupancy for the business, and salons commonly need local permits and inspections tied to the build out, plumbing and signage. Rules vary city by city: your city's development services office is the authority for your specific address.

Check zoning before the lease, not after. A cheap space in the wrong zoning category is not cheap once you have paid for chairs, plumbing and a sign you cannot legally use.

Insurance and the costs that keep coming back

Beyond the workers' comp decision above, salon owners typically shop for general liability coverage, professional liability coverage for the services performed, and property coverage for the build out, chairs, dryers and retail inventory. Premiums vary widely with your city, service menu and team size, so this guide does not quote benchmark prices that would be wrong for your shop. Get quotes before your lease starts, because many landlords require proof of liability coverage as a lease condition.

Your recurring state costs, by contrast, are small and predictable: license renewals on TDLR's two year cycle, sales tax collected and remitted on retail products, and the May 15 franchise tax information filing, free below the revenue threshold but never skippable. The expensive mistakes in a Texas salon launch are almost never the state fees. They are the lease signed before zoning was checked, the stylist hired before their license was verified, and the retail products rung up as untaxed services.

Dates to put on your calendar

• Every two years: renew practitioner and establishment licenses with TDLR, and verify the current continuing education rule on TDLR's site first.
• May 15, every year: franchise tax report, or Form 05-102 / Form 05-167 if you are below the no tax due threshold, due to the Comptroller.
• On the Comptroller's schedule: sales tax returns and remittance for retail product sales, at your assigned filing frequency.
• Within 20 days of each hire: new hire report to the Texas Workforce Commission.
• Not on your calendar: an annual report to the Secretary of State. Texas LLCs do not file one.

This guide is general information researched from official Texas state sources, not legal or tax advice. Requirements, fees and forms change; verify the current rules with TDLR and the other agencies linked above before you file, sign or spend.

Frequently asked questions

Do I need a cosmetology license to own a hair salon in Texas?

No. The owner of a Texas salon does not have to hold a practitioner license. What TDLR requires is an establishment license for the salon itself, and every person who provides services in it must hold their own individual license. If you plan to work behind the chair yourself, you need your own practitioner license as well.

How many hours of school does a Texas cosmetologist need?

A Cosmetology Operator license takes 1,000 hours at a licensed school. You then pass a written exam and a practical exam administered through PSI. You become eligible for the written exam after 900 hours of training. The application fee is $50, the minimum age is 17, and the license runs for two years.

How much does a Texas salon establishment license cost?

TDLR charges $78 for a Full-Service establishment license and $78 for a Specialty establishment license. A Mini-Establishment license, the type used for single suite style spaces, costs $70. The renewal fees are the same as the initial fees.

Are hair services subject to sales tax in Texas?

Generally, no. Haircutting and styling services are generally not taxable in Texas. Retail product sales are taxable, so take-home shampoo, styling products and similar items you sell are charged sales tax at 6.25 percent state rate plus up to 2 percent local tax, a combined maximum of 8.25 percent. Itemize services and products separately so tax is collected only on the products.

Do I still file a Texas franchise tax report if my salon owes no tax?

Yes. Salons under the no tax due threshold of $2,650,000 in total revenue for 2026 still have to file. The old No Tax Due Report was discontinued for reports due on or after January 1, 2024, so below threshold entities file a Public Information Report on Form 05-102, or an Ownership Information Report on Form 05-167, instead. The filing is due May 15.

Where do I file a DBA for a salon in Texas?

It depends on your business structure. LLCs and corporations file the Assumed Name Certificate, Form 503, with the Texas Secretary of State for $25. Sole proprietors and general partnerships file at the county clerk in each county where the business operates, at roughly $15 to $25 per county.