Flagstaff, Prescott, Prescott Valley, Sedona & Yuma Business Licenses for Side Hustles

TL;DR

• Four of these five places require a home business to register or license with the city. Flagstaff, Sedona, Yuma, and Prescott Valley do. Prescott's official Licenses page lists liquor, peddler/solicitor, special event, vacation rental, and TPT licenses, but no general business license. (City and town licensing pages.)
• City fees we verified (November 3, 2026): Flagstaff $8 a year; Sedona $70 for a new license, then $35 a year; Prescott Valley a one-time $60 registration with no annual renewal (new since January 12, 2026); Yuma's most common fees run $40 to $120 a year depending on your business classification. (City pages and fee schedules.)
• A city license is not a tax license. If what you sell is taxable, you also need an ADOR TPT license that lists your city location. All five places collect their city TPT through ADOR. (ADOR; city pages.)
• City retail TPT rates on ADOR's October 1, 2026 rate table: Flagstaff 2.486%, Prescott 2.95%, Prescott Valley 2.83%, Sedona 3.50%, Yuma 1.70%. These are added to the state and county rate. (ADOR TPT Rate Table.)
• Home occupation limits differ. Flagstaff caps home businesses at 20% of the home and one outside employee; Sedona allows 25% and no non-resident employees; Yuma allows 300 square feet, up to two non-resident employees, and two clients per hour. (City zoning codes and handouts.)

Who this guide is for

You live in Flagstaff, Prescott, Prescott Valley, Sedona, or Yuma and want to run a side hustle from home: tutoring, bookkeeping, photography, a craft or Etsy shop, mobile detailing, or guiding. Our Arizona Business License for Side Hustles guide covers Phoenix and Tucson, and our East Valley Side Hustle Business Licenses guide and West Valley Side Hustle Business Licenses guide cover the rest of metro Phoenix. This guide covers five of the largest cities and towns outside the two big metros.

We don't publish income claims. This page covers paperwork: what each place requires, what it costs, and the zoning limits on running a business from a house.

Quick comparison table

*City portion only, from ADOR's TPT rate table effective October 1, 2026. Confirm current rates on the ADOR rate table before you file.

Three separate things: city license, TPT license, and zoning

It's easy to mix these up:

1. City business license (or registration). The city's or town's permission to operate there.
2. TPT license. Arizona's sales-tax-style license, issued by ADOR. You need it only if your activity is taxable, such as retail sales. ADOR says a home-based business uses the home address as its business location and that zoning compliance is the business owner's responsibility. (ADOR, TPT License.)
3. Home occupation zoning rules. These limit how you run the business from a house. Flagstaff uses a separate Home Occupation Permit; Sedona, Yuma, and Prescott Valley review zoning as part of licensing or registration.

The Arizona Corporation Commission (ACC) points out that it doesn't issue business or occupational licenses; you register with your city (or county, if you're unincorporated) for those. (ACC, 10 Steps to Starting a Business in Arizona.) An LLC is separate from all three. See How to Start an LLC in Arizona for Your Side Hustle.

Flagstaff

License: Flagstaff requires a business license for each permanent business location in the city unless you're exempt. "Permanent" means operating from the site 45 days or more in a calendar year. Temporary locations and transient merchants need a license too. If you run the business from a home in city limits, you also complete an Application for Home Occupation Permit. (City of Flagstaff, Business Licenses.)

• Fee: $8, mailed with the application. (Flagstaff, Business Licenses; Business License Application Information Packet.)
• Term: Flagstaff's code says a license is valid for one year, starting the first day of the month you begin operating, and must be renewed on or before expiration. Operating without a license brings a failure-to-obtain penalty plus the fee for each year you operated unlicensed. (Flagstaff City Code §3-01-001-0006.)
• Processing: Flagstaff lists up to 15 business days for administrative review and 20 business days for substantive review, 35 business days total. (Flagstaff, Application Information Packet.)
• Exemptions (City Code §3-01-001-0003) include people who only make a casual sale; insurance licensees under Title 20; employees of licensed businesses delivering goods; certain food producers selling under A.R.S. §§ 3-561 to 3-563; fair vendors at a permitted special event; and residential rentals registered with the Coconino County Assessor. Read the list itself, because the wording matters. (Flagstaff, Application Information Packet.)
• Contact: Flagstaff Customer Service, solutions@flagstaffaz.gov, 928-213-2231. (Flagstaff.)

Home occupation rules: Flagstaff's Home Occupation Permit form summarizes Zoning Code §10-40.60.180. A home occupation:

• Is conducted only inside the dwelling, an accessory building, or a garage.
• Is run by residents, with no more than one outside employee coming to the home.
• Uses no more than 20% of the home's total floor area (and two home occupations at most per residence, sharing that 20%).
• Doesn't display or sell stock at the home, though customers may pick up orders placed by phone or at outside sales meetings.
• Has no outdoor display or storage and doesn't generate more traffic than is typical for the zone.

The form says submitting an application doesn't authorize you to start; you wait for written approval. (Flagstaff, Application for Home Occupation Permit.) We didn't find a separate permit fee on the form, so confirm any fee with Flagstaff Planning when you apply.

Prescott

License: Prescott's official Licenses page lists liquor, peddler/solicitor, TPT, special event, and vacation rental licenses. It doesn't list a general business license for home-based businesses. (City of Prescott, Licenses.) Local news reports say the city dropped its general license program in 2019 and the City Council has discussed bringing one back, so confirm with the City of Prescott before you assume you don't need one. Prescott also runs a free BizLink business concierge service for permitting, licensing, and zoning questions. (City of Prescott, BizLink.)

• TPT: Prescott says businesses with taxable activity need an ADOR TPT license and must report Prescott tax under region code PR. Prescott's rate is 2.95%; with the 6.35% state and Yavapai County rate, the total is 9.30% for most classifications. (City of Prescott, TPT License.)
• Vacation rentals and peddlers have their own city licenses. (Prescott, Licenses.)
• Long-term rentals: Since January 1, 2025, residential owners no longer collect city TPT on long-term residential rentals of 30 days or more but must still register the property with the county assessor. (Prescott, TPT License.)

Home occupation rules: We didn't find a Prescott home occupation handout we could verify for this update, so ask Prescott Community Development about home business limits before you invite clients over or store inventory. If your address is actually in unincorporated Yavapai County, the county requires a Home Occupation Permit under Section 543 of its Planning and Zoning Ordinance. (Yavapai County, Planning FAQ.)

Prescott Valley

Registration: Since January 12, 2026, Prescott Valley uses a business registration program instead of an annual license. All non-exempt businesses physically located in town, including home occupations, must register before they start. Register at least 15 business days before you begin operating. (Town of Prescott Valley, Business Registration; New Business Registration Program Announced.)

• Fee: New businesses pay a one-time $60 registration fee. There's no annual renewal; the registration stays valid until the business closes or changes ownership. Updating a location or other details is free. (Prescott Valley, New Business Registration Program Announced.)
• Older text on the town's page: The registration page still quotes an older ordinance about one-year licenses renewable for $45. The town's January 2026 announcement describes the newer registration model, so confirm the current fee with the Town Clerk.
• Process: The Town Clerk does an administrative review, then may refer the registration for zoning review, inspections, or health certification. Registration doesn't authorize anything that would violate the zoning code. You must show proof of authorized presence if you're an individual. (Prescott Valley.)
• TPT: The town points to ADOR for TPT licensing and notes a 0% town rental tax. Prescott Valley's retail rate is 2.83% on ADOR's table. (Prescott Valley; ADOR TPT Rate Table.)
• Contact: Town Clerk, 928-759-3135, clerk@prescottvalley-az.gov; town TPT questions, 928-759-3064. (Prescott Valley.)

Home occupation rules: Prescott Valley reviews home occupations through the registration process. We didn't verify the zoning limits for this update, so ask Prescott Valley Community Development for the current home occupation rules.

Sedona

License: Sedona requires a business license for any business physically located in city limits, including businesses run from a home, and for businesses at temporary special events. Businesses located outside the city don't need a Sedona license unless they take part in a special event in the city. The license is separate from TPT. (City of Sedona, Business License; Business Checklist.)

• Fee: $70 for a new license and $35 a year to renew, on a calendar year. Late renewal fees start February 1 at $5 per month. Changing your physical address costs $10. (Sedona, Business License; Consolidated Fee Schedule effective January 1, 2026.)
• Process: Online only. Sedona lists up to 47 business days: a seven-day administrative review and a 40-day substantive review that includes Community Development's zoning check. (Sedona.)
• Short-term rentals use a separate permit ($210 per unit on the fee schedule), not the business license application. (Sedona, Fee Schedule.)
• Exemptions (City Code §5.05.025) include employees of a licensed business; real estate licensees whose brokerage has a Sedona license; sellers of produce they grew in the city; casual activities or sales; and businesses outside city limits. (Sedona City Code §5.05.025.)
• Contact: City Clerk's Office, 928-203-5113, businesslicense@sedonaaz.gov. (Sedona.)

Home occupation rules: Sedona's handout on Land Development Code §3.4.D(4) says a home occupation:

• Is conducted in a dwelling or accessory building that's the proprietor's primary residence.
• Uses no more than 25% of the gross floor area on the site.
• Employs no one who isn't a resident of the dwelling.
• Doesn't generate more traffic than is typical for the zone, with parking on the property or its frontage (and never on grass).
• Keeps activity visible or audible off the property to 7 a.m.–10 p.m.
• Has a city business license.

(Sedona, Home Occupation handout.) The handout dates from 2021, so confirm with Sedona Community Development (928-282-1154).

Yuma

License: Yuma has two downloadable applications, a regular/commercial business license and a Home Occupation Business License. City staff review each application for location and business type before you pay. Businesses outside city limits that want to do business in Yuma also need a Yuma license. Once you pay, you can start operating, and the license must be displayed. (City of Yuma, Business License.)

• Fee: Depends on your business classification. Yuma says its most common fees range from $40 to $120 per calendar year, and all fees are non-refundable. The full schedule is in the Yuma City Code. (Yuma.) We didn't confirm which classification a typical home business falls under, so ask the Business License office for your fee.
• Special cases: Temporary or itinerant businesses, door-to-door sales, special events, and nonprofits have separate rules. (Yuma.)
• Contact: Business License & Sales Tax Office, (928) 373-5074, businesslicenses@yumaaz.gov. (Yuma.)

Home occupation rules: Yuma City Code §154-15.08 says a home occupation:

• Takes place in the home or an accessory structure, with a 300-square-foot maximum (shared by all home occupations at that address, including storage).
• Has no more than two employees who aren't residents or immediate family.
• Receives clients only from 7 a.m. to 8 p.m., and no more than two clients per hour.
• Doesn't display, sell, or rent goods on site.
• Uses only one business vehicle under 1.5 tons, and no deliveries beyond standard parcel services.
• May have one 1-square-foot window sign.

Renters and mobile home park residents need the owner's or manager's written permission. (Yuma City Code §154-15.08.)

City TPT: how it works outside the Valley

In all five places, ADOR licenses and collects the city portion of TPT, so you file one TPT return with ADOR that includes your city. (ADOR; city pages.)

• License fees: ADOR charges $12 per location for the state TPT license, plus any city fee. ADOR's license fee worksheet lists city fees of $20 (Flagstaff), $5 (Prescott), $2 (Prescott Valley), $2 (Sedona), and $2 (Yuma). Confirm the total at checkout. (ADOR, License Fees.)
• County rates: On ADOR's October 1, 2026 table, the combined state and county retail rate is 6.90% in Coconino County, 6.35% in Yavapai County, and 6.712% in Yuma County. Add the city rate from the comparison table above. Sedona straddles Coconino and Yavapai counties, so the county portion depends on which side your address is on. (ADOR TPT Rate Table.)
• Example: Prescott says its total rate for most classifications is 9.30% (2.95% city plus 6.35% state and county). (City of Prescott.)
• Services: Many professional and personal services aren't taxed under TPT, but cities can tax some activities the state doesn't. Ask ADOR about your specific activity. (ADOR.)

For the full TPT walkthrough, see Arizona TPT License for Side Hustles. If you sell on Etsy, eBay, or at craft fairs, see Arizona Online Sellers, Resellers & Craft Fairs.

Trade names (DBA)

If you operate under a name other than your own legal name (or your LLC's exact name), you can register a trade name with the Arizona Secretary of State, not the Arizona Corporation Commission. The SOS says a trade name isn't legally required, doesn't give exclusive rights to a name, and lasts 5 years. (Arizona SOS, Trade Names and Trademarks.) For the filing fee and steps, see the trade name section of our Arizona Business License for Side Hustles guide.

Regulated side hustles need more than a city license

A general city license doesn't replace state or city regulatory licenses. Watch for these common ones:

• Food: See the Arizona Cottage Food Law and Arizona Food Truck Permits and Licenses guides. Sedona publishes separate mobile food vending information. (Sedona.)
• Childcare: Rules depend on how many children you care for. See the Arizona Home Daycare License guide.
• Beauty, nails, lashes: Board licensing comes first. See the Arizona Cosmetology, Nail & Lash License Rules guide.
• Repairs and pools: See the Arizona Handyman Side Hustle: The ROC Exemption and Arizona Pool Cleaning Side Hustle guides.
• Vacation rentals: Sedona and Prescott both have separate short-term or vacation rental licensing. See Short-Term Rental Permits: Phoenix, Scottsdale, Tucson for how STR rules work in general.

A simple decision path

1. Find your city or town. Use your actual city limits, not your mailing address. Many Flagstaff, Prescott, and Yuma addresses are in unincorporated Coconino, Yavapai, or Yuma County.
2. Check the exemptions. Flagstaff and Sedona both exempt casual sales, for example. Confirm with the city.
3. Decide whether your activity is taxable. If it is, get the ADOR TPT license with your city location.
4. Read your city's home occupation rules before you invite customers over, hire help, or store inventory. Sedona doesn't allow non-resident employees; Flagstaff allows one.
5. Apply and keep it current. Flagstaff and Sedona renew yearly; Prescott Valley's registration doesn't expire but must be updated when details change.
6. Not sure? Call the licensing office, or try our Arizona side hustle license & permit checklist.

Frequently asked questions

Do I need a business license for a home business in Flagstaff? Usually, yes. Flagstaff requires a license for each permanent business location, including homes, unless you're exempt. The fee is $8, and home-based businesses also file an Application for Home Occupation Permit.

Does Prescott require a business license? Prescott's official Licenses page doesn't list a general business license; it lists liquor, peddler/solicitor, special event, vacation rental, and TPT licenses. Prescott has discussed reinstating a general license, so confirm with the city. If your activity is taxable, you still need an ADOR TPT license.

How much is a Prescott Valley business license in 2026? Prescott Valley switched to a business registration on January 12, 2026. New businesses pay a one-time $60 registration fee with no annual renewal. Confirm with the Town Clerk.

How much is a Sedona business license? $70 for a new license and $35 a year to renew. Late renewals cost $5 per month starting February 1.

How much is a Yuma business license? It depends on your business classification. Yuma says its most common fees run $40 to $120 per calendar year. Yuma has a separate Home Occupation Business License application.

Is a city business license the same as a TPT license? No. The city license is the city's permission to operate. The TPT license comes from ADOR and is needed only if your activity is taxable. Many side hustles need both.