POS system and accounting software for Arizona businesses

Transaction privilege tax, not sales tax

Arizona’s transaction privilege tax is a tax on the vendor for the privilege of doing business in the state, not a tax on the buyer. Most businesses pass it on to customers, so it looks like sales tax on a receipt, but the legal responsibility sits with the seller. The state rate for the retail classification is 5.6%, administered by the Arizona Department of Revenue.

Counties and cities add their own TPT, and the Department of Revenue collects most city taxes on a single return. Combined rates in the Phoenix metro area commonly run between 8% and 9%. SeroPOS sets the combined rate per store, and SeroBooks keeps tax collected by location and classification so the TPT return draws from figures already sorted.

Classifications, restaurants and groceries

TPT is charged by business classification: retail, restaurants and bars, amusements, commercial lease and others. The state rate is the same for retail and restaurants, but some cities set different rates by classification, so a Scottsdale business that sells retail goods and serves food can owe different city rates on each.

Food for home consumption is exempt from the state TPT, but a number of Arizona cities tax groceries at their own rate. A grocer in one city may charge no tax on staples while a grocer in the next town charges the city rate. SeroPOS item and location tax codes let you match whatever your city requires, and SeroBooks reports by classification.

• State TPT, retail classification: 5.6%
• Restaurants and bars: separate classification, city rates can differ
• Groceries: exempt from state TPT, taxed by some cities
• Economic nexus: $100,000 in Arizona gross sales

Payroll and nexus for Arizona businesses

SeroPayroll is Canada-only. Arizona employers run payroll in SeroBooks Pro at $300 a month, which handles federal and state withholding, including Arizona’s flat-rate income tax, and produces W-2 files in EFW2 format and 1099-NEC slips, posting once into the same ledger as sales and purchases. Nothing is keyed twice, and there is no separate payroll file to reconcile.

Arizona’s economic nexus threshold for remote sellers is $100,000 in gross sales into the state in the current or prior calendar year. Arizona brands selling online face each other state’s threshold too. SeroBooks watches nexus across all 50 states and flags when your sales into a state approach the line. Amazon sales are split out as marketplace-facilitated.

Phoenix, Tucson, Scottsdale and Flagstaff

Arizona’s calendar runs opposite to most of the country: winter brings snowbirds, spring training and golf, while summer heat slows foot traffic in the desert cities. SeroPOS reports sales by day and by trending item, and SeroBooks budgets, the cash-flow projector and demand forecasting help plan staffing and stock around the season.

SeroPOS serves Mexican restaurants in Tucson, coffee shops in Tempe, bars in Old Town Scottsdale and retailers in Mesa, Chandler, Gilbert and Flagstaff, in Spanish or English. Sero is based in British Columbia, Canada, and serves Arizona remotely by US phone at +1 (213) 265-9014, email and in-app chat, with no Arizona office.