How to Start an Esthetics Business in Indiana

Who licenses esthetics in Indiana

Esthetics answers to the State Board of Cosmetology and Barber Examiners, the combined board inside the Indiana Professional Licensing Agency that licenses estheticians alongside cosmetologists, barbers, manicurists and electrologists under Indiana Code Title 25, Article 8, with rules at 820 IAC. The board licenses two different things. The esthetician license belongs to the person, proving she finished 700 hours of training and passed the board's examination. The beauty culture salon 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. An esthetics studio needs both layers before licensed skin services are sold, and applications and renewals run online through the agency's MyLicense One portal.

The scope behind the license is statutory, and it rewards a careful read. IC 25-8-2-9.5 describes an esthetician as engaging solely in giving facials, applying makeup and giving skin care; in beautifying, massaging or cleansing the body with cosmetic preparations, antiseptics, tonics, lotions or creams; and in removing superfluous hair by depilatories, waxing or tweezers. Two exclusions sit nearby: threading is carved out of the definition entirely, and eyelash extension application is exempt under IC 25-8-1.1-2, so the two services an esthetics menu most often borrows from the lash world sit in different legal positions, one excluded and one exempt. The board's rules were also revised in 2026, with updates to 820 IAC under LSA Document #25-328 taking effect July 22, 2026.

Indiana esthetics at a glance

The esthetician license, step by step

Start with school. IC 25-8-12.5-4 sets the esthetician requirements: at least 17 years old, a 10th grade education, and graduation from an esthetics program in a beauty culture school, which in Indiana means 700 hours of esthetics training at a board approved school. Your school completes a Beauty Culture Education Certification form for the application. You then apply online, pay the $40 application fee by card, and upload your examination pass notice: the board tests estheticians with a written examination administered through PSI. Application fees are nonrefundable, and an application left incomplete for one year is treated as abandoned.

The 2026 expansion is the part of the license that changed most recently, and it is worth learning precisely. Effective July 1, 2026, HEA 1131 rewrote the esthetician definition to add eyelash lift and tinting, eyebrow lamination and tinting, and microneedling. Microneedling carries its own definition at IC 25-8-2-14.7: a cosmetic procedure in which fine needles create punctures at a penetration depth of at least 0.3 mm but not more than 2 mm, and a person offering it must, at the agency's request, provide proof of advanced training or certification. Devices and protocols that go deeper than 2 mm sit outside the esthetician scope, whatever the training certificate says. Cosmetologists, whose 1,500 hour license covers the esthetician scope, gained the same services on the same date.

The license renews every four years for $40, with renewal notices sent about 90 days before expiration and no continuing education requirement. The late ladder matches the rest of the board: a $50 late fee when renewing less than three years after expiration, reinstatement for $80 under IC 25-1-8-6 beyond three years, and the written examination again at five years expired. Post the license where you work; the board's facility instructions require every licensee to post the Indiana license at the workstation. Reciprocity applicants face the board's substantially equal test, under which one year of licensed practice counts as 100 hours of education for an applicant holding at least 400 of the 700 hours.

The beauty culture salon license and your premises

The studio itself is licensed as a beauty culture salon under IC 25-8-7, the single establishment license covering hair, skin and nail premises alike. There is no esthetics only salon license in Indiana; the salon license you file for a skin studio is the same license a full service salon holds, at $40 to apply and $40 to renew every four years. 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 premises will be under the personal supervision of a licensed beauty culture professional, which for a skin studio ordinarily means a licensed esthetician or cosmetologist.

Timing is the trap. 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 three months. File at lease signing and the window can close while treatment rooms are still being built, leaving the studio unable to operate until the license issues. Operating without the temporary permit can get the application denied, and so can letting unlicensed people perform licensed services in the studio while the application pends. A studio 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 a sale. Under IC 25-8-4-4 a license is non-transferable, with a narrow exception for a salon or barber shop license when the holder had to change location for reasons the board finds were beyond her control. A buyer files her own salon application. Mobile esthetics work takes the mobile salon license instead, at the same $40 fee, covering a self-contained movable facility or equipment transported to salons, 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 studio formed in April owes its first report by the end of April 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 solo esthetician can technically operate on her Social Security number for some federal purposes, but the studio's bank account, booking platform payouts and employer registrations all run more cleanly on an EIN.

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). Esthetic services are not on that list, so you do not collect sales tax on facials, waxing, lash lifts or any other service receipt. Product is different: skincare, cleansers 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.

Room rental and booth rent in Indiana

Indiana answers the room rental licensing question in the 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 she 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 renting esthetician needs no establishment license of her own. She works inside the host's licensed salon on her own esthetician license, posted at her room, and the host's salon license covers the premises for both of them. An esthetician who wants her own name on an establishment license for her own space is opening her own salon, or working the salon suite model covered in that guide.

Classification is the separate question the cosmetology code does not decide. Whether a renting esthetician is an independent contractor or the host's employee for tax and unemployment purposes turns on the control based tests the IRS and the Department of Workforce Development apply to the actual arrangement: who sets the hours and prices, whose clients they are, who supplies the product and equipment, and who can end the relationship. Paper the rental like a real tenancy, with a lease, a fixed rent that does not float with her service revenue, her own assumed business name filing and her own tax registrations, and keep the daily practice consistent with the documents.

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. Estheticians 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 esthetics business

The local layer begins with the approvals the salon 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 treatment room buildouts run through local inspection like any other commercial work. Signage, parking and occupancy rules sit at that level too, varying between an Indianapolis storefront, a spa district suite and a home based studio. One Indiana distinction saves confusion: county health departments here permit body art, not esthetics, so there is no county health permit layer on a skin studio unless the menu crosses into permanent makeup, which is tattooing under the body art framework in the microblading guide.

Confirm zoning and the inspection sequence in writing before signing the lease. The salon license is issued for a specific address, the application starts a three month temporary permit clock when complete, and moving restarts parts of the stack. The week spent confirming that the space can legally hold an esthetics studio is the cheapest week in the project.

Insurance for an Indiana esthetics business

The board's rules do not publish a required insurance amount for a beauty culture salon, so treat insurance as a risk decision and a lease decision rather than a licensing line item. Skin services, chemical peels within scope and microneedling all argue for professional liability written for esthetic practice specifically, not a generic premises policy alone. 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: statutes and rules compilation, IC 25-8 including the esthetician scope at 2-9.5, microneedling at 2-14.7 and license requirements at 12.5-4
• State Board of Cosmetology and Barber Examiners: July 1, 2026 esthetician scope expansion announcement, HEA 1131
• State Board of Cosmetology and Barber Examiners: licensing information, hours, fees, salon and renewal instructions
• INBiz: Secretary of State business filings, Articles of Organization and Business Entity Reports
• 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 esthetics FAQ