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Residential rentals are taxable at 2.2% for the City of Surprise (unless you meet the exemption below). Residential rentals are not taxed by the State or County. You will need an Arizona State Privilege License in order to report the rental tax collected for the City of Surprise. Please note that you are only applying for a program city license, so you will pay the fee that corresponds with that particular city. The fee for The City of Surprise is $10.00. You will need to submit a Transaction Privilege Tax City Only Application.
Exemption: If you have less than 2 residential rentals within the State and no commercial rental properties within the state, you are not deemed to be in the rental business, and are therefore exempt from the tax. However, if your rental property is leased through a Property Manager, every residential rental property located in the City of Surprise is subject to tax. In addition, each property owner is required to have a tax license, regardless of the City of Surprise minimum number of rentals.Note: If you also own a commercial rental anywhere in the State, every residential rental property located in the City of Surprise is subject to tax, regardless of the City of Surprise minimum number of rentals.