What to Expect From the Transaction Privilege Tax Simplification

by Michelle Lind on July 16, 2014

Transaction Privilege Tax SimplificationEffective January 1, 2015, the Arizona Department of Revenue (DOR) will become the single point of administration and collection of state, county and transaction privilege tax (TPT), commonly referred to as a Sales, Resale, Wholesale, Vendor or Tax License. For business owners where cities administered their own taxes, this means that the taxpayer no longer has to file and pay separate filings and returns with the state and then the city.  Rather, there will now be one location to file and pay a return.  Additionally, business owners will be able to file and pay on one form for all jurisdictions.

Real property rentals, commercial leasing, construction contracting, and owner/builders are types of business activities subject to TPT.  Other business activities subject to TPT include, but are not limited to:  retail sales, restaurants/bars, hotel/motel (transient lodging), advertising, amusements, personal property rentals, manufactured building, severance (mining, timbering), transportation, printing, publishing, utilities, communications, air/railroad, private cars/pipelines and use tax.  See http://www.azdor.gov/Business/TransactionPrivilegeTax.aspx.

What to Expect

  • Taxpayers who file for more than one location must e-file their tax return.
  • All taxpayers will receive an annual renewal notice this fall from DOR. If you conduct business in a city that has a renewal fee, you will pay DOR the renewal fee(s).
  • TPT licenses will be valid for one calendar year. This means you will need to renew your license annually with DOR.
  • If you do not renew your city TPT license timely, you may be penalized up to $25.
  • If your business has multiple locations or under multiple names and files a consolidated tax return, you will be required to pay only one municipal TPT renewal fee for each jurisdiction.
  • If your business operates in multiple locations or under multiple names and does not file a consolidated tax return, you will be required to pay a license renewal for each location in each jurisdiction.
  • There will no longer be the e-signature document required when registering on AZTaxes.gov.  This means you will no longer need to mail in a signature card when you register for AZTaxes.gov.

For more information, go to https://www.azdor.gov/TPTSimplification.aspx;

http://www.azdor.gov/About/FAQs/TPT.aspx.

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