transaction privilege tax simplification 2015 arizona transaction privilege tax simplified

Transaction Privilege TaxSimplification

2015

Arizona Transaction Privilege Tax Simplified


This presentation will cover the following topics of upcoming TPT Simplification Changes

• Renewal Process • Licensing, Filing and Paying for 2015• Audit Changes • Contracting Changes

Topics Covered


The Arizona Department of Revenue has a hotline for questions about renewals, licensing and other

TPT Simplification issues.

(602) 542-5027

TPT Simplification Hotline


All TPT taxpayers currently licensed with DOR should have received a cover letter and renewal form with some preprinted license information in November 2014.

Renewals – Calendar Year 2015


DOR will update licensing information as the renewals are received.

New licenses, valid from January 1, 2015 through December 31, 2015 will be mailed to the taxpayers with in 30 days of DOR receiving the completed renewal form.

Taxpayers that made changes to licensing information, but did not remit all applicable fees may expect billings.



Taxpayers with a city license in the following cities: Apache Junction, Avondale, Chandler, Douglas, Flagstaff, Glendale, Mesa, Nogales, Peoria, Phoenix, Prescott, Scottsdale, Sedona, Tempe, and Tucson may receive a City Renewal Form with fees due from those cities also.

It is important that taxpayers complete and return all renewal forms specific to the business for all the appropriate jurisdictions.



Taxpayers will continue to license, file and pay DOR for the state and current program cities.

Use current Joint Tax Application (Form JT-1) to obtain state and program city TPT licenses

Use the current Transaction Privilege, Use and Severance Tax Return ( Form TPT-1)

Taxpayers will continue to license, file and pay nonprogram cities for 2015.

Licensing, Filing & Paying Beginning January 1, 2015


Changes• Due Date - For all taxpayers not electing to file

electronically, TPT returns must be received by DOR on or before the second to the last business day of the month.

• Filing Frequency – Taxpayers with small liabilities may be able to file less often. Taxpayers should wait for a notice from DOR before adjusting filing frequency.



Changes (continued) • Bulk Filing available by jurisdiction will be available

for state and current program cities reporting. • Standardized Business Codes – One list of business

codes The code is the same for both the State and the

Cities when the tax base is the same. A code has been created for the Cities when the

tax base is not similar.



Changes(continued) • Standardized Deduction Codes – One list of deductions codes

The code list has been expanded to ensure every allowable deduction has a specific code.

There will no longer be a code for “Miscellaneous Deductions”. Specifically codes 888 & 999 are no longer valid and use may result in disallowed deductions and penalties and interest may apply

Standardized lists will be available at www.azdor.gov



Arizona Department of Revenue will be the single source of TPT audits • General Audit Manual – Posted on the DOR website

• Auditor Training by DOR Auditors were provided with standardized training. Training classes were held in 4 locations in Arizona.

• Standardized Audit Letters developed by DOR.

Audit Change Implementation 2015


• Electronic Audit Files Eliminates paper audit files Electronic transfer of files through the audit,

manager review and appeals process• New AATC- Advanced Arizona Tax Calculator

Tool used to calculate tax liabilities/credits Incorporates taxpayer filing history for the state,

county and cities More than 90% faster than the previous version



• License Compliance coordination between state and cities staff

• “The Hub” group will be the liaison between all state and city audit personnel



Non construction, or service contactors, are exempted from prime contracting on both the state and city levels.

Sales of materials to “service contractors” and contractors performing nontaxable MRRA contracts are subject to tax if:

1. The contractor works directly for property owner, and 2. Does maintenance, repair, replacement or alteration of

existing property

All other contracting activity remains taxable under the current statutes.

Changes for Contractors in 2015


A “Phase In” of new functionality for current taxpayers and program cities will occur during 2015.

System changes to handle “location based reporting”

Location based reporting for cities and towns records the gross revenue and other information for each location with in a reporting jurisdiction.

Taxpayers with multiple locations with in a jurisdiction will report information for each location on a separate line of the City Tax section of the new TPT-1.

Enhancements Planned For Calendar Year 2015


• Estimated target for completion July 1, 2015 New online JT-1 Form with auto-fill Geo Coding

• Estimated target for completion October 1, 2015 Enhanced AZTaxes functionality Location based reporting processing New location based TPT-1 Bulk filing by location

Enhancements Planned For Calendar Year 2015


DOR will become the single point of administration and collection of TPT

Effective January 1, 2016


All TPT taxpayers currently licensed with DOR and the 18 non program cities will renew through DOR beginning in November 2015

There is no renewal fee for the state or current program cities

Only 1 Renewal Fee per owner/entity per jurisdiction for those cities with a renewal fee

Current licensing fees will apply to new locations and certain changes in licensing information.



Licensing, filing and paying through DOR for the state and all city taxable activities

Use the NEW Joint Tax Application to obtain a license

Use the NEW Transaction Privilege, Use and Severance Tax Return to file state taxes and city taxes by location

Enhanced functionality available on AZTaxes. gov for licensing, filing and paying for the state and all cities



Additional information on the TPT Simplification Project and other

topics is available on the Arizona Department of Revenue website.

www.azdor.gov

transaction privilege tax simplification 2015 arizona transaction privilege tax simplified

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