If you are tossing around the idea of starting a cake or cupcake business, wanting to sell only at the markets, for fun, just to make a bit of ‘pocket’ money, and see if you want to turn it into a full blown business.

Hobby Cake Business & Licensing | Hobby Cakes or Business Cakes | Do I need a food license to sell cakes | Cake business Advice | Cake Business Tips | Angel Foods | Cake Business School

What is a hobby cake business (if I am wanting to sell only at the markets)?


That’s just a hobby, not a business, isn’t it?


Do I need a Food License?

Insurance for your cake business | Selling Cake at markets | Angel Foods | Cake Business School

When I started Angel Foods, the intention was just to sell cupcakes at the markets.  That was it.  I only wanted to earn a couple of hundred dollars per week, for a little extra spending money. 


And that’s exactly what I did.  I set up, I practiced recipe’s and flavors (man, I was dreaming of cupcakes for weeks!) and got legal.  I turned up to those markets, every week. 


Since that beginning, Angel Foods has transformed to a National Cake Company, and it is awesome to start with a simple desire to sell some *sweet* cake!


Is it a hobby business?  The answer is no.  And yes.  Read on…

How to set up a hobby cake business to be legal –


While you personally consider selling at the market a ‘hobby’ because it doesn’t make much money, it is still selling cake.  To sell food requires a Food License.


  • Food License– this is an essential requirement for selling Food.  No market will accept stall holders without a Food License.  Getting a Food License is much easier than you think, and even easier if you are selling (only) at the markets!  You will require either a Domestic Food License or 52 Day License, from your local Council.  Specifically tell them it is for selling at the markets only, and that you won’t be using fresh cream (they are funny with this one!)  This costs approximately $400, depending on your local council.To read more on Food Licensing head here.
  • Insurance– your local markets won’t accept food stalls without Public Liability Insurance and you will need to provide a certificate of purchase.  AAMI have a specific market stall holder policy for $195 per year, which is quite affordable.


This is ultimately all that is required when selling cakes from the markets.

The difference between hobby and business –


  • Tax Deductions– while considering whether you are a hobby or a business, remember a business can claim all it’s tax deductions.  Keep all your receipts (ingredients, Food License, Insurance, Packaging, etc) and once a month add up the expenses and income.  Give this to your accountant at tax time.
  • Accountant– it is always recommended to discuss with your accountant about starting a business.
  • Australian Business Number– to claim tax deductions you will require an ABN.  It takes 40 minutes of your time, is free and I highly recommend their free help line.  Get your ABN here.
  • Register Business Name– this is an Australian legal requirement when setting up a business (to go with the ABN and for Tax Deductions).  It is not painful at all and takes 30 minutes online.  Register here.



My two cents worth, if you are going to spend the money on Food Licensing and Insurance, you might as well treat is a business and get some tax deductions (seeing as it doesn’t cost you an extra to do so.)


But hey, if you really aren’t called to get an ABN, and want to sell cakes, at markets, purely as a hobby, do that.

Just start. 

–Pin It For Later!!

Hobby Cake Business & Licensing | Hobby Cakes or Business Cakes | Do I need a food license to sell cakes | Cake business Advice | Cake Business Tips | Angel Foods | Cake Business School

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Comment below.


Rebekah Allan


Founder – Angel Foods and Cake Business School


I would love to hear from you.