Businesses or individuals who purchase an aircraft from an out-of-state vendor may be subject to use tax.
What is Use Tax?
Use tax is a tax on purchases made out-of-state for taxable items stored, used, or consumed in Arizona when the sale was not subject to transaction privilege tax (TPT). While the state use tax rate is equal across all counties, the cities/towns may impose an additional use tax.
Do You Owe?
If the out-of-state vendor does not charge tax, the purchaser is required to remit use tax directly to Arizona Department of Revenue (ADOR). If the vendor is not engaged in business in Arizona, meaning it does not have a physical presence in the state, generally the vendor will not charge Arizona tax.
After an aircraft has been registered with the Arizona Department of Transportation (ADOT), the agency will send the information to the department. ADOR will conduct research to determine if use tax was remitted at the time of the sale. If more information is needed, ADOR will notify the purchaser via a questionnaire, and the business or individual will need to provide all necessary supporting documentation. If a use tax liability exists, ADOR will notify the purchaser of an amount due.
An out-of-state vendor engaged in business with Arizona taxpayers must register with ADOR for a TPT license and must remit tax on retail sales of tangible personal property.
Understanding Use Tax
Vehicle Use Tax Calculator
Federal Aviation Administration
Arizona Department of Transportation – Aircraft Services
For further assistance, please email [email protected] or call (602) 716-6450.