Along with the Arizona Transaction Privilege Tax (TPT), the city of Tempe in the state of Arizona charges a sales tax. This implies that companies operating in Tempe must collect both taxes on specific items and services they provide to residents of the city.
The current Tempe City Sales Tax rate is 1.8%. The Arizona TPT rate, which varies based on the kind of business and the area, is in addition to this. For instance, Tempe’s total sales tax rate is 2.5% when the TPT rate for retail transactions in Maricopa County is 0.7%. Tempe’s overall sales tax rate is 7.4% because to the 5.6% TPT rate for restaurants in Maricopa County.
It’s important to keep in mind that the TPT in Arizona is not a sales tax but rather a tax on the right to conduct business there. This implies that companies without any taxable sales nevertheless need to apply for a TPT license and submit tax returns. Various transactions, such as retail sales, rentals, leases, and some services, are subject to the TPT.
How then do you make TPT payments in Arizona? Through the website of the Arizona Department of Revenue, companies can sign up for a TPT license and submit their taxes online. The expected taxable sales of the company determine the frequency of filing, with most small enterprises filing on a quarterly basis. Penalties and interest costs may apply if TPT regulations are not followed.
As we go on to the Maricopa County sales tax rate, it’s significant to remember that the rate changes depending on the location. Some cities and towns within the county apply their own sales tax rates in addition to the 0.7% base rate set by the county. For instance, Mesa has a rate of 1.75% while Phoenix has a rate of 2.3%. As a result, a company providing products or services in Tempe but based in Phoenix would have a total sales tax rate of 4.1%.
Lastly, is there an income tax in Tempe? No, neither Tempe’s citizens nor its businesses are subject to an income tax. Tempe residents and businesses must still pay both state and federal income taxes.
In conclusion, it might be challenging to comprehend the numerous taxes and rates that are applicable to businesses in Tempe and Arizona. To ensure compliance with all rules and to reduce their tax liability, businesses should speak with a tax expert.
You would need to know the current sales tax rate, which can be obtained on the Arizona Department of Revenue website, to calculate sales tax in Tempe City or any other city in Arizona. To calculate the amount of sales tax you must pay, multiply the entire cost of your purchase by the applicable sales tax rate. For instance, if the total cost of your transaction is $100 and the sales tax rate is 8%, you would be required to pay $8 in sales tax.
You can go to the Arizona Department of Revenue’s website and make an online request for a 1099-G form. To get a form by mail, you can also phone their customer care hotline at 602-255-3381 or toll-free at 800-352-4090. Additionally, if you have an account with the Arizona Department of Revenue, you might be able to access your 1099-G form online.