Arizona Sublease Agreement

The Arizona sublease agreement is a legal contract that allows a tenant to rent out all or a portion of the property to a subtenant in exchange for regular payments.

Does a Tenant Need the Landlord’s Permission to Sublet in Arizona?

A tenant does need a landlord’s explicit written consent to sublet in Arizona. Even after consent is given, a landlord still has the right to reject a subtenant if they are unqualified, such as for having a poor work history or low credit score. Read More

Standardized Arizona Sublease Agreements

• The Names of the Parties – The original tenant under the lease is named in the sublease and is called the “Sublessor.” The third-party that is subleasing the rental unit is named in the sublease and is called the “Sublessee.”
• Rental Unit Location – The address for the rental unit as described in the master lease.
• Term – The exact date of the sublease beginning and ending date.
• Rent – How much the rent is, when it needs to be paid, and how to pay it.
• Utilities – The utilities to be paid by the Sublessor and those that are to be paid by the Sublessee.
• Liability – The sublessee will be liable for any damages to the Sublessor. The Sublessor has the ultimate responsibility to pay for any damages that impact the landlord as stated in the master lease agreement.
• Authorized Occupants – This identifies the new tenant(s) and those that are authorized to live in the rental unit including any policy about short-term guests.
• Security Deposit – This security deposit is held by the Sublessor (not the landlord). Arizona state law limits a security deposit to a maximum of one and one-half month’s rent. A pet deposit or other special deposit may be an additional amount.
• Return of Security Deposit – Arizona state law requires a full refund of the security deposit, or the balance left after legitimate deductions, within 14 business days after a tenant vacates the rental unit. Any deposit that is non-refundable needs to be clearly stated in the rental agreement; otherwise, all deposits are considered fully refundable.
• Inventory of Included Items – The list of items in the rental unit that are part of the sublease which may include furniture or appliances.
• Lead-Based Paint Notice – Under Federal law, if the rental unit’s premises were built before 1978, the Sublessee must be given a written warning notice, called a Lead-Based Paint Disclosure.
• Master Lease Inclusion – A copy of the Master Lease is attached to the sublease. If any exceptions in the Master Lease are not included they should be clearly stated in this section.
• Disputes – A description of how disputes between the Sublessor and Sublessee are to be settled, which may include mediation and binding arbitration to avoid more expensive legal proceedings.
• General Conditions – A statement that the written sublease agreement contains all of the agreements between the parties and can only be modified by written consent of the parties to the agreement.
• Smoking Policy – If smoking is restricted in the rental unit and any designated smoking areas are identified in the sublease.
• Landlord’s Consent – This section describes how the landlord is asked to give consent (if consent is not already included in the Master Lease). Tenants may create a signed sublease that is conditional on being accepted by the landlord before the sublease becomes effective.
• Signature: The signature and date for the Sublessor, the Sublessee, any Co-Sublessors, and Co-Sublessees (if they exist).

Tax Implications of a Sublease

In Arizona, a sublessor may be subject to the Transaction Privilege Tax (TPT) if they sublet a property for more than 30 days. If the sublessor leases the property for less than 30 days, they are subject to the State Transient Lodging fees.

Taxes and fees vary by county.

Frequently Asked Questions

Is subletting legal in Arizona? Is subletting legal in Arizona? Yes, subletting is legal in Arizona. However, if a lease specifically prohibits subletting, then tenants are not allowed to sublease the rental unit. It’s a good idea to get the landlord’s permission, however, to ensure subleasing doesn’t violate any housing regulations or maximum occupancy requirements. Read more »