How to Start a Barbershop in Indiana

Who licenses barbershops in Indiana

Barbershops answer to the State Board of Cosmetology and Barber Examiners, the combined board inside the Indiana Professional Licensing Agency that licenses barbers alongside cosmetologists, estheticians, manicurists and electrologists under Indiana Code Title 25, Article 8, with rules at 820 IAC. Owners arriving from states with a standalone barber board should recalibrate: in Indiana there is one board, one application portal at MyLicense One, and one establishment chapter for both salons and shops. The board licenses two different things. The barber license belongs to the person, proving he finished 1,500 hours of training and passed the written examination. The shop license belongs to the location, proving the premises meet the board's facility requirements and sit under the personal supervision of a licensed beauty culture professional. A shop needs both layers before the first paying client.

The barbering scope is defined in the statute and includes the work a shop menu is built on: cutting, styling and coloring hair, and shaving and trimming beards and mustaches, including straight razor work, with the facial and scalp preparations that go with it. The definition expressly excludes natural hair braiding, which the legislature exempted from the whole article in IC 25-8-1.1-1, so braiding services on a mixed menu sit outside the barber license entirely. The board's rules were freshly revised in 2026, with updates to 820 IAC under LSA Document #25-328 taking effect July 22, 2026 across education, fees, practice, sanitation and facility requirements.

Indiana barbershop at a glance

The barber license, step by step

Start with school. The barber license requires 1,500 hours at an Indiana approved beauty culture school, and the preliminary education rule is the strictest on the board: an applicant must be at least 18 years old, or 17 and a graduate of high school or the equivalent. Your school completes a Beauty Culture Education Certification form for the application, and Indiana also accepts completion of a U.S. Department of Labor registered apprenticeship program, documented with an apprentice number and certificate of completion. You then apply online, pay the $40 application fee by card, and upload your examination pass notice: Indiana tests barbers with a written examination administered through PSI. Fees are nonrefundable, and an application left incomplete for one year is treated as abandoned.

The license renews every four years for another $40, with renewal notices sent about 90 days before expiration and no continuing education requirement attached. The late ladder is worth memorizing before you ever need it. Renewing less than three years after expiration carries a $50 late fee on the board's renewal form. Beyond three years, reinstatement under IC 25-1-8-6 costs $80, the renewal fee plus the application fee, with any remediation the board orders. At five years expired, the board's remediation is fixed: take and pass the written licensing examination again. Keep the license posted at your chair, because the board's facility instructions require every licensee to post the Indiana license at the workstation.

If you trained in another state, the reciprocity route asks whether your home jurisdiction imposes substantially equal requirements. Where its hours fall short of Indiana's 1,500, the board can credit one year of licensed practice as 100 hours of education, and the other jurisdiction must require at least 70 percent passing on its written and practical examinations. A barber licensed in a state with a short course should expect the board to do arithmetic on his file, not simply stamp it.

The barber shop license and your premises

The shop itself is licensed under IC 25-8-7, the beauty culture salon chapter. There is no separate barber shop license form hiding elsewhere in the system: you apply for the salon license, and IC 25-8-7-1(b) provides that the license states it is a barber shop in prominent type. The application fee is $40 and the license renews every four years for $40. The application sequence is prescribed: select the site, obtain any building permit, certificate of occupancy or other approval required under IC 22-15-3 and IC 36-7-4, install the furnishings and equipment the board's rules require, and file a verified statement that the shop will be under the personal supervision of a licensed beauty culture professional.

The timing rule is where new shops get hurt. The agency instructs applicants not to apply until the facility is ready to open, because a temporary permit issues on a complete application and is valid for only three months. Apply while the plumbing is still open and the permit window runs out before the chairs are set; you may have to close until the license issues. Operating without the temporary permit can get the application denied, and so can letting unlicensed people cut hair in the shop while the application is pending. A shop in the same building as a residence must be separated from the living space by a substantial floor to ceiling partition with its own separate entry.

Licenses do not transfer with the business. Under IC 25-8-4-4 a license is non-transferable, with a narrow exception allowing a salon or barber shop license to move when the holder had to change location for reasons the board determines were beyond his control. Selling the shop means the buyer files his own shop application; changing chairs, services or ownership inside the same four walls does not move the license to a new holder. Mobile barbering has its own license at the same $40 fee, covering a self-contained movable facility or equipment transported to other shops, homes and nursing homes, under a licensed professional's personal supervision.

Forming your business entity

Most Indiana beauty businesses form as an LLC, and Indiana prices the form near the bottom of the national range. The Articles of Organization, State Form 49459, are filed with the Secretary of State through INBiz and cost $95 online or $100 by mail. The online figure is built into the statute and the Secretary of State's fee schedule: a $75 filing fee under IC 23-0.5-9-19 plus a $20 enhanced access fee. The articles name your registered agent and your principal office, and INBiz issues the certificate that your bank, your landlord and the licensing board will each ask to see.

The filing that keeps the entity alive is the Business Entity Report, and Indiana runs it on a two year cycle rather than the annual cycle most states use. The first report comes due two years after formation, by the end of the month in which the entity was formed, and it costs $32 filed online or $50 on paper. INBiz charges no late fee, but a missed report is not free: the Secretary of State can administratively dissolve an entity that stops filing, and reinstatement means filing every overdue report and paying the reinstatement charges. A shop formed in September owes its first report by the end of September two years later, and every two years after that. None of these filings replaces the licenses above. The Secretary of State registers your entity, and the board licenses your people and your premises, and the two systems do not talk to each other.

Business names and the assumed business name

Indiana calls its trade name filing a certificate of assumed business name, and IC 23-15-1-1 splits the filing office by the kind of business you are. A sole proprietor or a general partnership trading under a name other than the owner's real name files the certificate for record with the county recorder of each county where the business has a place of business or an office, and the recorder charges the recording fee set by IC 36-2-7-10 on the county's schedule. An entity that trades under a name different from the name in its formation documents files the certificate with the Secretary of State instead, on State Form 30353 through INBiz: the fee is $20 for an electronic filing or $30 on paper for a corporation, limited liability company, limited partnership or limited liability partnership. The statute sets no renewal or expiration for the certificate. It stays on file until you file a notice that you have stopped using the name.

Two practical points follow. The assumed name filing is a public notice filing, not a license and not a trademark, and it does not reserve the name against anyone else; a name reservation through INBiz, $10 for 120 days, is the tool that holds a name while you organize. And the name on the certificate, the name on the salon license application and the name on your signage should tell one consistent story, because clients, inspectors and your bank all read them side by side.

Federal tax ID and business banking

Apply for an Employer Identification Number on IRS.gov. It is free, it issues online in one session, and any site charging you for an EIN is selling you a form you can file yourself. You need the EIN to open the business bank account, to run payroll once you hire, and to complete the state employer registrations described below, which key on the federal number. A one chair shop run as a sole proprietor can operate without an EIN for some federal purposes, but the bank account, card processing and the employer registrations that arrive with the first hire all run more cleanly on one.

Open the business bank account as soon as the entity and EIN exist, and run every license fee, product order and rent payment through it. The Department of Revenue registrations, the unemployment wage reports and the biennial entity report all assume the business can show its own books, and a clean account is the cheapest compliance tool in this guide.

Sales tax through the Department of Revenue

Indiana sets its sales tax at a flat 7 percent statewide, and no city or county adds a local sales tax on top of it (IC 6-2.5-2-2). The tax itself is a gross retail tax on retail transactions, which the statute defines around sales of tangible personal property and a specific list of enumerated transactions (IC 6-2.5-2-1 and IC 6-2.5-4-1). Barbering is not on that list, so you do not collect sales tax on haircuts, shaves, beard work or any other service receipt. Product is different: pomade, grooming products and anything else you sell off the shelf is a retail sale taxed at 7 percent, so itemize services and products separately at checkout and the tax follows the product lines only.

Any business making retail sales needs a Registered Retail Merchant Certificate before its first retail transaction. Registration runs on the Department of Revenue's Business Tax Application, Form BT-1, filed through INBiz, and the filing fee is $25 per business location under IC 6-2.5-8-1. The certificate is valid for two years and renews automatically while the account stays in good standing, and returns and payments run through INTIME, the Department's e-services portal. Register before you open: the same BT-1 also opens the withholding account you will need the day you hire.

Booth rent and chair rental in Indiana

Indiana answers the chair rental licensing question in one statute. IC 25-8-7-7 provides that the board may not require a beauty culture professional to obtain a license under the salon chapter if he has leased or subleased a portion of a beauty culture salon from a person licensed under that chapter. There is no booth renter license in Indiana, and a renter needs no establishment license of his own. He works inside your licensed shop on his own barber license, posted at his chair, and your shop license covers the premises for both of you. The same statute is what makes the salon suite model work in Indiana when a suite operator chooses to lease space inside a licensed establishment rather than licensing her own space, as the salon suite guide explains.

What the statute does not decide is classification. Whether a chair renter is an independent contractor or your employee for tax and unemployment purposes turns on the control based tests the IRS and the Department of Workforce Development apply to the real arrangement: who sets hours and prices, whose clients they are, who supplies the tools and product, and who can end the relationship. A rental agreement is evidence, not a verdict. Shops that rent chairs should paper the deal like a tenancy, with a lease, a fixed rent that does not float with the renter's service revenue, the renter's own assumed business name filing and tax registrations, and daily practice that matches the paper.

Hiring employees in Indiana

Your first hire registers you as an employer in two places. The Department of Revenue takes your withholding registration on the same BT-1 application filed through INBiz, covering state and county income tax withholding, with returns filed through INTIME. The Department of Workforce Development runs the unemployment insurance account, and registration happens online through Uplink Employer Self Service in the first quarter your business qualifies as an employer; electronic filing and payment are mandatory, and wage reports come due every quarter whether or not you had payroll. Unemployment premiums are charged on the first $9,500 of each employee's wages per calendar year. A new employer starts at the typical rate of 2.5 percent, which caps the cost at $237.50 per employee per year, and then moves onto merit rates based on the business's own claims history, which run from 0.50 percent to 7.40 percent for employers in good standing under the Department of Workforce Development's Employer Handbook.

The wage floor is $7.25 an hour, where Indiana's minimum wage has stood since July 24, 2009 under the Indiana Minimum Wage Law, matching the federal floor. Barbers who regularly receive tips can be paid a cash wage of at least $2.13 an hour if you claim a tip credit, but if tips plus the cash wage fall short of $7.25 in any week, the business makes up the difference dollar for dollar. Overtime runs at one and one half times the regular rate past 40 hours in a work week, and Indiana lets you pay $4.25 an hour to employees under 20 during their first 90 consecutive days on the job.

Local rules for an Indiana barbershop

The local layer is the layer the shop license itself points to: the building permit, certificate of occupancy and zoning approvals under IC 22-15-3 and IC 36-7-4 come from your city or county, and the board expects them in place before the shop operates. Signage rules, parking requirements, occupancy limits and any local business registration sit at that level, and they vary enough between a downtown Indianapolis storefront, a strip center in Evansville and a home based shop that no state guide can price them for you. One Indiana distinction saves a phone call: county health departments here permit body art, not barbershops, so there is no county health permit layer on a shop.

Confirm the zoning and the inspection sequence in writing before you sign the lease. The shop license is issued for a specific address, the application starts a three month temporary permit clock the moment it is complete, and moving restarts parts of the stack. The week spent confirming the space can legally hold a barbershop is the cheapest week in the project.

Insurance for an Indiana barbershop

The board's rules do not publish a required insurance amount for a barber shop, so treat insurance as a risk decision and a lease decision rather than a licensing line item. In practice, a landlord will name the coverage he expects in the lease, and a business working on clients should carry professional liability for the services themselves, general liability for the premises, and property coverage for equipment and retail stock. If other licensees work inside your premises under your salon license, your policy and theirs should both name the arrangement, because the salon license holder is the name the board and an injured client find first when something goes wrong in any chair, table or room in the building.

Your Indiana renewal calendar

Official sources

• State Board of Cosmetology and Barber Examiners: licensing information, hours, fees, salon and renewal instructions
• State Board of Cosmetology and Barber Examiners: statutes and rules compilation, IC 25-8 including sections 4-4, 4-17, 7-1 and 7-7
• INBiz: Secretary of State business filings, Articles of Organization and Business Entity Reports
• Secretary of State: enhanced access fee schedule for business filings
• IC 23-15-1: assumed business names, county recorder and Secretary of State filings and fees
• Indiana Department of Revenue: sales tax, Registered Retail Merchant Certificates and withholding
• Department of Workforce Development: Unemployment Insurance Employer Handbook, rates and wage base
• Indiana Department of Labor: Indiana Minimum Wage Law poster, $7.25 and the $2.13 tip credit wage

Indiana barbershop FAQ