Arizona Resale Certificate 2026: TPT License and Tax-Free Purchasing Guide

Arizona does not technically have a "sales tax." Instead, the state imposes a Transaction Privilege Tax (TPT), which is a tax on the seller for the privilege of doing business in Arizona. The practical effect for consumers is similar: you pay more at the register. But for businesses, the distinction matters. It affects how you register, how you file, and how resale certificates work.

This guide covers everything you need to know about Arizona's TPT License, Form 5000A (the Arizona Resale Certificate), tax rates, contractor-specific rules, and the registration process for 2026.

What Is the Transaction Privilege Tax (TPT)?

In most states, sales tax is a tax on the buyer that the seller collects on behalf of the state. Arizona flips this. The TPT is a tax on the seller's gross receipts from doing business. The seller may pass the cost to the buyer, and most do, but legally the tax obligation sits with the seller.

Why this matters:

• Your TPT License is not a "sales tax permit." It is a license to conduct taxable business activities
• Arizona has multiple TPT classifications (retail, contracting, restaurant, etc.), and the rate can vary by business activity
• The resale certificate (Form 5000A) works as a deduction from the seller's gross receipts, not a buyer-side exemption

Despite these legal differences, the day-to-day process is familiar: register for a TPT License, provide Form 5000A to your suppliers, and purchase inventory without tax.

Arizona Tax Rates in 2026

State TPT Rate

Arizona's state TPT rate for retail is 5.6%. This is the base rate for retail transactions.

County and City Rates

Arizona counties and cities impose additional privilege taxes. Combined rates vary widely:

Combined rates can reach approximately 11.2% in certain jurisdictions. For a business purchasing $100,000 in inventory annually in Phoenix, using a valid resale certificate saves $8,600.

Check your specific savings with our savings calculator.

Form 5000A: Arizona's Resale Certificate

Form 5000A is Arizona's official Resale Certificate. You provide this to suppliers to document that the goods you are buying will be resold and are therefore not subject to TPT at the point of purchase.

Required Information on Form 5000A

• Purchaser's name and address: Your business legal name and registered address
• TPT License number or out-of-state registration number: Required to validate your authority to purchase for resale
• Type of business: Retail, wholesale, manufacturing, etc.
• Description of tangible personal property: What you are purchasing
• Certification statement: You certify the goods are for resale in the ordinary course of business
• Signature and date: Must be signed by the purchaser or authorized representative

Key Details

• Form 5000A does not expire as long as your TPT License remains active
• Arizona also accepts the Multistate Tax Commission (MTC) Uniform Sales & Use Tax Certificate from out-of-state buyers
• You must provide a separate Form 5000A to each supplier
• The supplier retains the form as proof that the transaction qualifies for a deduction from their gross receipts

How to Register for an Arizona TPT License

Online Registration Through AZTaxes.gov

The Arizona Department of Revenue (ADOR) handles TPT License registration through its online portal.

Registration steps:

1. Visit AZTaxes.gov
2. Select "Register" and create an account
3. Complete the Joint Tax Application (JT-1), which registers you for both state and city TPT
4. Provide your Federal EIN, business structure, physical location, and business activity classifications
5. Submit the application

Processing time: Online applications take approximately 2 to 3 weeks to process. During peak periods, processing can extend to 4 weeks.

Cost: Arizona does not charge a fee for the TPT License itself.

Business Activity Classifications

When registering, you must select the correct business activity classifications. Common ones include:

• Retail (for selling tangible goods)
• Contracting (for construction work)
• Restaurant (for food service)
• Rental (for renting tangible personal property)

Your classification determines your tax rate and filing requirements. Selecting the wrong classification can cause problems down the line.

What You Need to Register

• Federal EIN (or SSN for sole proprietors)
• Business entity information
• Physical business location (or registered agent address)
• Description of business activities
• Estimated monthly gross receipts
• Start date of business activity in Arizona

Need help with the application? We handle the complete registration process.

Get Your Resale Certificate -->

What Qualifies for the Resale Deduction in Arizona?

Because Arizona's TPT is a seller-side tax, the resale certificate technically gives the seller a deduction from their gross receipts. The practical result is the same: you buy goods tax-free when they are for resale.

Qualifying Purchases

• Tangible personal property for resale: Products you will sell to customers
• Raw materials and components: Items incorporated into a finished product for sale
• Packaging materials: Boxes, bags, wrapping used to ship or package goods for sale
• Items for rental or lease: Goods you rent to customers in the ordinary course of business

Non-Qualifying Purchases

• Office supplies and furniture: Used by your business
• Tools and equipment: Used in operations
• Fixtures, signage, and displays: Store equipment
• Vehicles for business use: Company vehicles (unless you are a dealer)
• Consumables: Items used internally

How Arizona Treats Contractors

This is where Arizona's system gets particularly nuanced. Contractor treatment under Arizona's TPT is significantly different from most states.

Prime Contractors vs. Subcontractors

Arizona makes a critical distinction between prime contractors (who contract directly with the property owner) and subcontractors (who contract with the prime):

Prime contractors:

• Are subject to the contracting classification of TPT
• Pay TPT on 65% of the total contract price (the remaining 35% is a deemed deduction for labor)
• Can take deductions for amounts paid to licensed subcontractors

Subcontractors:

• May use resale certificates (Form 5000A) to purchase materials that will be transferred to the prime contractor
• The materials "flow through" to the prime contractor, who is ultimately responsible for the TPT
• This only applies when the subcontractor provides materials as part of a contract with a licensed prime contractor

Practical Example

A residential construction project in Phoenix:

The key distinction: Subcontractor materials flowing to a prime contractor can be purchased with a resale certificate. Materials purchased for jobs where you are acting as the prime contractor are subject to the contracting TPT.

This system is more favorable to subcontractors than most states, where contractors at all levels are treated as end consumers. But the rules are specific and depend on the contract structure.

For more details on contractor rules across all states, read our construction materials sales tax guide or the subcontractor resale certificate guide.

Filing Requirements After Registration

Filing Frequency

Arizona assigns filing frequency based on your estimated monthly TPT liability:

How to File

File through AZTaxes.gov. Arizona's TPT return combines state, county, and city taxes into a single filing. This is a significant advantage over states like Colorado and Louisiana, where local filings are separate.

Due Dates

Monthly returns are due on the 20th of the month following the reporting period. Quarterly and annual due dates follow the same pattern for their respective periods.

Common Mistakes to Avoid

Mistake 1: Treating TPT Like Regular Sales Tax

Arizona's TPT is legally different from a sales tax. If you file in multiple states, do not apply the same logic to Arizona. Understand the seller-side nature of the tax and the deduction-based system for resale certificates.

Mistake 2: Wrong Business Classification

Registering under the wrong activity classification can lead to incorrect tax rates, misfilings, and audit issues. A retailer who accidentally registers under the contracting classification will face different rates and rules.

Mistake 3: Subcontractors Misusing the Resale Certificate

Subcontractors can only use Form 5000A for materials flowing to a licensed prime contractor. Using it for materials on a job where you are acting as the prime is not permitted and will be assessed during an audit.

Mistake 4: Ignoring City-Level Rates

Arizona's city privilege taxes are not optional. You must collect and remit at the correct combined rate for each location where you do business.

Mistake 5: Not Keeping Form 5000A on File

Sellers who accept Form 5000A from buyers must keep the forms on file. Without them, the seller loses the deduction from gross receipts and owes the full TPT on those transactions.

Record Keeping Requirements

Arizona requires businesses to maintain TPT records for at least 4 years from the date of the transaction or the date the return was filed, whichever is later.

What to Maintain

• Completed Form 5000A certificates (given to suppliers and received from buyers)
• TPT returns and payment records
• Invoices, purchase orders, and receipts
• Contract documentation (especially important for contractors)
• TPT License documentation

Get Your Arizona TPT License and Resale Certificate

Arizona's TPT system is unique, but the registration process through AZTaxes.gov is well organized. Get your TPT License, complete your Form 5000A, and start purchasing inventory tax-free.

Get Your Resale Certificate -->

For full details on Arizona's requirements, visit our Arizona state page.

Arizona's Transaction Privilege Tax may carry a different name, but the bottom line is the same: registered businesses can purchase goods for resale without paying tax at the point of purchase. Get your TPT License, use Form 5000A correctly, and keep your records clean.

Related Articles

• What Is a Resale Certificate? - Learn the fundamentals of resale certificates and how they work across all states.
• Resale Certificate for Contractors and Construction - Arizona's contractor rules are unique. See how they compare to other states.
• Sales Tax Exemption Forms: Complete Guide - Find Form 5000A and compare it to exemption forms used in every other state.