How to Get an Arizona Business License

Do I need a business license in Arizona? 

While Arizona doesn't have a statewide general business license requirement, your business may still need to acquire one or more licenses to operate in the state. Certain industries and locations may be subject to city, state, or federal licensing requirements.

Arizona state

As mentioned above, Arizona doesn't have a blanket state license requirement for all businesses, but depending on your business activity, you may need one. The Arizona Department of Revenue determines who needs a license and what kind they must acquire. Some businesses don't need a license, while others may need to obtain several licenses or permits to comply with state regulations.

For instance, your business may need a Transaction Privilege Tax (TPT) license, regulatory permits or licenses, and/or industry certifications at the state level.

If your business sells goods or services subject to use tax, you must apply for a transaction privilege tax license, commonly referred to as a sales tax license, with the Arizona Department of Revenue (ADOR). Restaurants, bars, advertising agencies, telecommunication companies, and hotels are a few examples of businesses needing this kind of tax license.

State agencies also regulate certain business activities, such as child care, construction, home inspections, and the sale of alcohol and tobacco. Businesses in these fields must acquire special state licenses to operate legally in Arizona.

Furthermore, the state requires industry certifications for regulated occupations. For instance, speech therapists, cosmetologists, teachers, and real estate agents must obtain state certifications in order to operate in Arizona.

Local

While the state doesn't have a general license requirement, the local level may. Cities and counties can set their own rules and regulations, which include license requirements based on your business location.

There is a wide range of local-level regulations that cover everything from county health department permits to planning and zoning permits. Some examples of city- and county-regulated operations include mobile food vendors, pawn shops, pet stores, food establishments, and home-based businesses.

Federal

Federal agencies also require businesses to obtain certain licenses and permits depending on their business operations. Some federally regulated industries include those related to finance, automobile, aviation, radio and television broadcasting, fish and wildlife, and transportation and logistics.

How to get a business license in Arizona in 5 steps

Now that you have a better understanding of some of the business license requirements in Arizona, follow these steps to help ensure compliance:

Step 1: Form your business

Before applying for licenses or permits, you must first form your business. This involves choosing your business structure and selecting an appropriate business name that aligns with government naming guidelines. You can elect to form a limited liability company (LLC), corporation, partnership, or sole proprietorship.

To formally establish your business, you must file articles of organization with your Secretary of State in Arizona.

Step 2: Obtain an employer identification number

Once the Secretary of State approves your articles of organization, you can apply for an employer identification number (EIN). You'll need this number if you file separate business taxes, open a business bank account, or hire employees.

You can apply for an EIN through the Internal Revenue Service (IRS) or allow LegalZoom to file your application for you.

Step 3: Apply for a state business license

Now it's time to determine if you need a state business license.

We recommend filling out the Arizona Commerce Authority's checklist to determine which licenses apply to your business. You can also contact state agencies or review Arizona revised statutes to determine if your business is subject to these regulations.

Next, visit the Arizona Department of Revenue website and navigate to the Arizona Business One Stop. This online portal lets you create an account and apply for the appropriate state licenses. If you need the TPT license, the online portal will direct you to the AZTaxes.gov website, where you can submit your application and pay the $12 filing fee.

Step 4: Apply for local-level licenses

Each jurisdiction has its own licensing regulations, so your business location and operations will determine what local licenses and permits you need. It's also important to note that you might need multiple licenses if your business operates in more than one city or town.

Contact your city hall or county clerk for additional information about licensing compliance. The Arizona Authority Commerce website has a list of the town/city offices.

Step 5: Apply for federal licenses

Finally, find out if your business activity is federally regulated.

Federal agencies are responsible for ensuring certain industries are compliant. For instance, the Alcohol and Tobacco Tax and Trade Bureau (TTB) oversees businesses that sell alcohol and requires them to obtain liquor licenses. Meanwhile, the United States Department of Agriculture (USDA) ensures that businesses selling produce acquire PACA licenses (as required by the Perishable Agricultural Commodities Act of 1930).

Navigate to the U.S. Small Business Administration (SBA) website to learn more about federal license and permit requirements. Once you know which ones your business needs, contact the issuing agency for details on how to apply, as each has its own process and filing fees.

After getting your Arizona business license

Once you complete these steps and receive the appropriate business licenses, display them in a prominent location at your place of business, ensuring they're visible to the public.

Don’t forget: Some permits and licenses expire, so be sure to make a note of when you need to renew them. For instance, you must renew your TPT license every Jan. 1. If you fail to renew your licenses on time, you might face late fees.

Getting an AZ business license the easy way

Navigating federal, state, and local requirements can be tricky, so let LegalZoom do the heavy lifting for you. Our Business License Report and Management service provides a summary of all the licenses that apply to your business and registration and renewal details to ensure your business is compliant. We keep track of everything for you, so you can focus on building and growing your business.

FAQs

What should I do before getting a business license?

There are a few steps you must take before getting a business license in AZ, such as performing a business name search, selecting a compliant business name, filing articles of organization, and obtaining an EIN. LegalZoom can help you with every step of the business formation process, from checking your name availability to drafting your operating agreement.

How long does it take to get a business license in Arizona?

It depends on what kind of business license you're applying for and where you're applying. For example, if you're registering for the TPT license through AZTaxes.gov, you will receive your license number the same day and your mailed certificate within seven to 10 business days. Meanwhile, if you're applying for a business license in Peoria or Gilbert, it could take up to 30 days to process, but typically, the timeframe is around 10 business days. 

How much is a business license in Arizona?

The cost will vary depending on what kind of business licenses you need. For instance, a TPT license costs $12, a Peoria business license costs $45, and a Mesa business license costs $10. When adding up costs, remember that your business may need multiple business licenses and permits, resulting in multiple filing fees.

Does my business need the TPT license to operate in Arizona?

TPT refers to the state's transactional tax privilege, also known as sales tax. If your business is subject to sales tax, meaning you pay taxes on your taxable goods or services, then you must acquire a TPT license from the Arizona Department of Revenue.