Although typically described as a sales tax, the Arizona deal advantage tax (TPT) is really a tax on a supplier for the privilege of doing business in the state. Various service activities go through deal privilege tax and need to be accredited.

If a service is selling a product or engaging in a service subject to TPT, a license from the Arizona Department of Revenue (ADOR) would likely be needed as well as a deal benefit tax or business/occupational license from the city or cities in which the company is based and/or runs.

ADOR gathers the tax for the counties and cities; however, tax rates vary depending upon the kind of organization activity, the city and the county.

Please note that companies with multiple places or business lines can opt to license and report for each place separately or have a consolidated license (and report aggregate sales). The cost for each license per location is $12.

Get a TPT License

Glossary of Terms

TPT and Use Tax:

Individuals go through utilize tax when a seller does not collect tax for concrete personal residential or commercial property used, kept or consumed.

Those individuals and companies subject to utilize tax consist of the following:

- An out-of-state seller or utility organization making sales of tangible individual residential or commercial property to Arizona purchasers.
- Arizona residents who buy items using a resale certificate, and the items are utilized, saved or consumed in Arizona contrary to the function stated on the certificate.
- Arizona citizens who buy goods in which another state's sale tax or other excise tax was imposed and the rate of that tax is less than Arizona's usage tax rate.

See our Reporting Guide for hassle-free access to TPT-related guidance and resources.

See the TPT Estimated Payment page for information and how to pay.

What's New with TPT?

New Age Rule for TPT License

Effective September 14, 2024, individuals under the age of 19 may operate a business without a transaction benefit tax (TPT) license if that service does not generate more than $10,000 in gross income in a calendar year. See Arizona Revised Statutes (A.R.S.) § 42-5045.

Additionally, individuals under the age of nineteen and who run a service periodically, are not needed to have any kind of license or allow for service for city and county functions. Please reach out directly to the pertinent city or county with business license or allow questions.

If an individual under the age of nineteen is currently operating a service with a TPT license (with an adult included on the license) and business does not generate more than $10,000 in gross sales each year, then the license might be cancelled with the effective periods beginning October 1, 2024. Please make sure that returns are submitted based upon the filing frequency assigned at the time of registration. If a filing is missed out on or a final return is not submitted prior to cancellation of the TPT license, then penalties and interest might accrue. See instructions on how to cancel a TPT license.

Residential Rental Tax Changes

Starting January 1, 2025, property rental residential or commercial property owners should no longer collect and remit any city deal benefit tax (TPT) on the earnings originated from long-lasting lodging stays of one month or more to ADOR. (Laws 2023, Chapter 204 and A.R.S. § 42-6004 (H)).

This applies to licensees that are signed up and have filed utilizing company code 045 suggesting that license is engaged in the business classification of residential leasing. Residential leasing is the leasing of genuine residential or commercial property for a period of 30 or more consecutive days for residential (i.e. noncommercial) functions only.

Currently, there is no state or county tax imposed on domestic leasings, and the approaching modification to the tax law will get rid of the city TPT. While there will no longer be a city TPT commitment starting January 1, 2025, you must still sign up the residential or commercial property with the county assessor to abide by property owner tenant laws and other compliance requirements from federal government entities. Owners can still submit for prior durations online even if the license has actually been canceled or the location has been closed.

For tax periods before January 1, 2025:

- You need to still abide by filing and payment requirements, and
- These durations remain subject to examine as allowed by statute.

Please note: Hotel, motel, or other transient lodging services that book stays for fewer than 1 month need to still gather and remit TPT under the short-term lodging or hotel category.

What Should I Do?

Please continue to gather, submit, and pay domestic rental TPT for durations through December 31, 2024, filed in January 2025. For periods starting January 1, 2025 and afterwards, it is no longer needed to collect, submit, and pay domestic rental TPT.

No further action or actions require to be required to cancel the license. Know that cancelation of the license will not excuse you from any liabilities associated with durations before January 1, 2025. If liabilities are overdue, enforcement actions may be taken against you. Go to to AZTaxes.gov to deal with any impressive liabilities or missing out on returns for the license.

Tax Rate Change

For tax rate changes, please see Model City Tax Code's Rate and Code Updates and TPT Newsletters.

Arizona Business One Stop is an online website that offers a single online location with individualized tools to plan, start, grow, move and close businesses in Arizona. It is a safe digital experience that does not need in-person interaction.

Arizona-based businesses should visit Business One Stop (B1S) if forming their business for the very first time. Please note: New Business One Stop TPT licenses submissions will direct you to pay at AZTaxes.gov. TPT filings, payments, and renewals are only available at AZTaxes.gov at this time.

Businesses requiring upgraded info on deal advantage tax can access ADOR's monthly newsletter, TPT Tax Rate Table and Model City Tax Code changes here by clicking the appropriate month and year. For older information, please visit our archives.

Businesses can also register for ADOR's TPT newsletter and get updates through e-mail or text signals. They can receive notifications relating to TPT due dates, city tax rate modifications, license renewals and brand-new features on AZTaxes.gov.