Last updated
The Arizona Corporation Commission forms your LLC. It does not license it. The license that matters most for a business that sells things is the transaction privilege tax license from the Arizona Department of Revenue, usually shortened to ADOR. Your city may want its own license on top.
Does Arizona have one general business license?
The pages we read do not describe one. The Department of Revenue's transaction privilege tax page explains the system instead. Various business activities are subject to the tax and must be licensed. Rates depend on the activity, the city and the county. ADOR collects the tax for the counties and cities.
If you sell a product or provide a service subject to TPT, expect two layers. One is the ADOR license. The other is a TPT or business or occupational license from the city where you are based or operate.
What does the TPT license cost?
$12 for each license per location, per ADOR. The page also gives a choice for businesses with several locations or business lines. You can license and report each location separately. Or you can take a consolidated license and report total sales.
The page does not list a renewal fee, so we do not quote one. Check the renewal screen before you pay.
How do you apply and renew?
New Arizona businesses can start at Business One Stop, which ADOR points to for first-time formation. Payment for a Business One Stop TPT license is then made at AZTaxes.gov. TPT filings, payments and renewals are made at AZTaxes.gov. ADOR sends email alerts about due dates, city rate changes and renewals if you subscribe.
Why is TPT not just a sales tax?
People call it a sales tax, but ADOR says it is a tax on the vendor for the privilege of doing business in the state. That matters for how you price and invoice. The seller owes it, whether or not the seller passes it on to the customer. ADOR collects it for the counties and cities, which is why one return can carry several rates.
That also explains the extra city step. Each city sets its own rate and may have its own license, so a business that operates in two cities may deal with two sets of local rules. ADOR publishes a monthly newsletter on TPT changes and city rate updates for businesses that want to follow them.
What should you register after forming the LLC?
Order matters a little.
- Form the LLC with the Corporation Commission. The listed filing fee is $50. Our Arizona LLC guide has the steps.
- Get an EIN from the IRS. See how to get an EIN.
- Register with ADOR. The Commission says an Arizona TIN comes from the Department of Revenue, not from the Commission.
- Ask your city whether it wants a license too.
If you plan to trade under a brand name, read the Arizona DBA guide as well.
Where do you check an Arizona license?
We did not read a license verification tool, so we do not link one. For the LLC's own status, use the Corporation Commission search described in our Arizona business search guide. For general lookups, see business license lookup and state tax ID lookup.
Is there an exception for young business owners?
ADOR says people under 19 may run a business without a TPT license if it does not earn more than $10,000 gross in a calendar year. That is the state rule only. The page tells these owners to contact their city or county about local license questions.
What this page does not cover
Professional licenses, liquor licenses, city fees, county rules and rates are not covered here. We did not read any city source. This is not legal or tax advice.