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“Short-term rental” or “vacation rental” means any individually or collectively owned single-family or one-to-four-family house or dwelling unit or any unit or group of units in a condominium, cooperative or timeshare, that is also a transient public lodging establishment or owner-occupied residential home offered for transient use. Short-term rental and vacation rental do not include a unit that is used for any nonresidential use, including retail, restaurant, banquet space, event center or similar use. (Town Code Section 10-14-1)
In 2017, the Arizona State Legislature enacted A.R.S. §9-500.39 which preempts local authorities, including Paradise Valley, from regulating short-term rentals based solely on their classification or use. Consequently, these rentals are allowed by state law. Additionally, long-term rental (greater than 30-days) is permitted under Section 1004 of the Town of Paradise Valley Zoning Ordinance. Whether the property is rented short-term or long-term, the entire property must be rented as a whole. Accessory buildings may not be leased, subleased, or rented separate and apart from the main building and no main building may be leased, subleased, or rented separate and apart from an accessory building.
A.R.S. §9-500.39 does not preclude the ability for Home Owner Associations to regulate or restrict these types of uses. In 2019, the Superior Court of Arizona ruled in Camelback Country Estates Unit One Homeowners Association, Inc., vs. Forty Sixth Place LLC, that the Homeowner’s Association CC&Rs could restrict business uses of properties within the HOA.
No short-term rental or vacation rental may be used for any non-residential use or purpose including but not limited to any of the uses listed in ARS § 9-500.39(B)(3).
Yes. All short-term and vacation rental properties in Paradise Valley are required to pay both Transaction Privilege (Sales) Tax and a Transient Tax (bed tax). Property owners are responsible for obtaining a TPT license from the Arizona Department of Revenue. Property owners who ONLY book through an Online Lodging Marketplace (OLM) (with applicable taxes paid by the OLM) must still file a tax return showing the gross receipts received from the OLM with a deduction equal to the amount received from the OLM.
The Arizona Department of Revenue (DOR) issues tax licenses and collects taxes on behalf of the Town. You may submit the license application online at: https://azdor.gov/transaction-privilege-tax/tpt-license/applying-tpt-license . See also: https://azdor.gov/transaction-privilege-tax/residential-rental-guidelines
In addition to completing a Transaction Privilege (Sales) Tax License, property owners must also register the rental property with the Maricopa County Assessor’s Office.