Key figures
Arizona receivables
2026, with sources
TPT is not a sales tax
Arizona’s transaction privilege tax is a tax on the seller for the privilege of doing business, measured by gross receipts and divided into classifications: retail, personal property rental, contracting, and so on. Sellers usually pass it on, but the liability is theirs, whether or not it was charged. The state rate for retail and personal property rental is 5.6%, and counties and cities add their own.
SaaS falls under personal property rental. That matters for nexus: under ADOR’s ruling TPR 24-1, the $100,000 economic threshold counts retail sales only, so a remote SaaS seller has to collect only once it has physical presence, such as an employee in Arizona.
Cities
Arizona’s cities levy their own privilege taxes under the Model City Tax Code, and each can tax categories the state doesn’t, at its own rate. Since 2017 ADOR licenses and collects for all of them, so a single TPT license and a single return cover the state and every city, with the city lines reported by location.
Returns are due on the 20th of the month after the period, monthly, quarterly or annually depending on liability. Customer credits that go unclaimed are reported to ADOR as unclaimed property.
Deadlines
- 20th of the following monthTPT return (monthly filers)TPT-2
The federal baseline
This page covers what Arizona adds. The federal rules underneath it apply here too.
Common questions
Is SaaS taxable in Arizona?
Yes. The Department of Revenue taxes SaaS as a rental of tangible personal property. The Court of Appeals upheld that in ADP v. Arizona Department of Revenue in January 2023, and the Arizona Supreme Court declined review that September. Cities apply their own rates to the same transaction.
Does a remote SaaS seller have nexus in Arizona?
Not from sales alone. ADOR’s ruling TPR 24-1 says the $100,000 economic threshold counts retail sales only, and SaaS is a personal property rental. A SaaS company without physical presence doesn’t cross the threshold with subscriptions; one employee working in Arizona is physical presence, and that does.
Receivables next door
- CACalifornia receivablesCalifornia’s 7.25% sales tax doesn’t reach SaaS today, but SB 122 makes prewritten SaaS taxable from January 1, 2027; out-of-state sellers register once California sales pass $500,000.
- NVNevada receivablesA 6.85% state sales tax plus county rates, on tangible goods only — SaaS is not taxable. Remote sellers register at $100,000 or 200 transactions.
- UTUtah receivablesUtah taxes SaaS as prewritten software used in Utah, at 4.85% plus local rates. Remote sellers register at $100,000 of Utah revenue; the transaction count is gone.
- COColorado receivablesA 2.9% state sales tax, a $100,000 nexus threshold, and home-rule cities that write their own rules. The state doesn’t tax SaaS; Denver and some other cities do.
- NMNew Mexico receivablesNew Mexico taxes gross receipts, not sales: 4.875% state plus local, on services and software licenses, sourced to the customer. Remote sellers are in at $100,000.
Founder guides on this
- Sales taxSales tax nexus for startups: when you owe tax in a stateSince Wayfair, selling into a state can create a sales tax obligation. How economic nexus works, why SaaS is taxable in some states and when to register.
- RevenueDeferred revenue for SaaS startups, explainedAn annual prepayment is cash today and revenue over a year. How deferred revenue works under ASC 606, why it’s a liability, and the schedule behind it.
- StripeHow to reconcile Stripe payouts to your booksA Stripe payout is charges less fees, refunds and disputes, batched across days. How to book it gross, tie it to the bank, and keep revenue right.
More of the Arizona guide
- AccountingAccounting and state tax in ArizonaCorporate tax, conformity to federal rules, apportionment and what it does to your books
- PayablesPayables and contractors in ArizonaPaying vendors and contractors: 1099 filing, use tax, contractor tests and withholding
- PayrollPayroll taxes and employer rules in ArizonaWithholding, unemployment insurance, paid leave, minimum wage and the rules on paydays
- ComplianceCompliance and filings in ArizonaRegistering to do business, annual reports, franchise tax and the filing calendar
- AdvisoryAdvisory: credits and decisions in ArizonaCredits, incentives and the decisions that are cheaper to get right the first time
Sources
Checked against each agency’s own page on . Rates and thresholds change, usually on January 1.
General information for US companies, not tax, legal or accounting advice for yours. Rules and thresholds change; confirm the specifics with a CPA or the agency before you act on them.