What should I know about business licenses in Arizona?
As entrepreneurial watchers of The Grand Canyon State already know, Arizona is in a state of flux. The population is booming, the economy is expanding, and the state's business license requirements are changing to meet new demands.
Where they end up in the long run is anybody's guess, but in the short run, it's crucial for business owners to closely track the business license laws and regulations as they evolve.
One of the most conspicuous examples of change in the regiment of Arizona business licenses and permits happens at the city level and concerns the TPT, otherwise known as the Transaction Privilege Tax. (This tax differs from a traditional sales tax since it is imposed upon the seller of goods rather than the buyer.) The TPT is always levied by the state, but local TPTs can complicate the picture.
Many cities in Arizona impose this tax in addition to standard business licenses upon all businesses that operate within their jurisdiction. It's nearly impossible to say how many since cities are constantly adopting it while others abandon it in a never-ending game of Arizona business license roulette.
But the TPT doesn't just vary by city. It also varies by business activity. If you operate multiple locations in Arizona and each one conducts more than one taxable business activity, the Arizona business license complications will add up. Moreover, this is on top of local business licenses, which are very common in Arizona.
How many business licenses do you need?
The number of business licenses you need in Arizona depends on a number of unique factors.
These factors include...
- Within which city/county will you operate your business?
- What business activities will you be conducting?
- How heavily regulated is your industry? Etc.
To put it in perspective, we ran the following queries through our own business license research tool. Here are some authentic results:
This may include a state-specific Arizona health license. There are 20 or more forms and documents a business owner may need to consult as they seek to obtain this license. They include an Application for Certificate of Need and many, many, many, many schedules.
This may include a county-specific Maricopa vehicle repair/service license. To obtain this permit, you likely need to submit an Application for Vehicle and Mobile Equipment Refinishing Operation among others.
This may include a local Chandler home occupation permit. At the very least, business owners will need to submit a Home Occupation Application to obtain this permit.
Common Arizona business license questions
Discover some of the most common questions about Arizona business licenses, and what you need to know to start your business in the Grand Canyon state.
If you’re starting a business in Arizona then you’re in luck; the state of Arizona does not require a business license. But that doesn’t mean you can just set up shop. Keep in mind that while the state may not need a license, most of the cities and towns in Arizona require their own business licenses.
Depending on your industry, you may need additional licenses, permits, or certifications to conduct business.
How much a business license in Arizona costs depends on which cities in Arizona you do business in. For example, Phoenix, Arizona, does not have or issue a general business license. However, there are some businesses that require licenses and/or permits.
Other cities do require a business license. A business license in Surprise, Arizona, could cost you up to $168.00 per license. If you’re starting a business in Tucson then a business license may require a $25 application fee and a potential $50 annual license fee that is prorated by the quarter.
The first step in obtaining a business license in Arizona is determining if you need one. Doing that will take some research on your part. It’s important that you connect with each city or town office where you’re based or do business to see if they require a license.
Alternatively, you can let Avalara do the research for you with managed license services. Learn how Avalara helps you identify and find the documentation you need.