Background. Certain purchases, including rental cars and lodging rentals, are also subject to special sales taxes as high as 11.25% in some localities. You must file a tax return in Colorado if, during the tax year, you were a full-time resident, part-time resident with taxable income during the time you were a resident, or a non-resident of the state with income from a Colorado source. © 2020 SalesTaxHandbook. Additional information regarding licensing and filing requirements for mobile vendors can be found online at, Anyone making sales at a flea market or farmers market in Colorado is a retailer and is subject to sales tax licensing, collection, and filing requirements with respect to each market at which they make sales. If you owned and lived in your home for two of the last five years before the sale, then up to $250,000 of profit may be exempt from federal income taxes. If a retailer maintains multiple business locations in Colorado, a separate license is required for each business location. Sales and use taxes are the primary revenue sources for Colorado municipalities, and while none currently have a tax rate higher than 8% there is no limit set by the state government. See Department publication FYI Sales 86: Sales Tax Exemption on School-Related Items for information about sales made by schools and school organizations. Retailers must consider whether the nature of goods or services sold is consistent with the purchaser’s claim that the sale is exempt from sales tax. See. They must also file returns and remit collected taxes at regular intervals, generally on a monthly basis. that levy a sales tax have different rates, rules and laws. These sourcing rules do not apply to leased property. If the retailer’s average or estimated monthly sales tax collection is $15 or less, the Department may grant the retailer permission to file on an annual basis. Purchasers who meet certain qualifications may apply for a direct payment permit. Sales of rooms and accommodations may be exempt when made to a permanent resident who enters into a written agreement for occupancy for a period of at least 30 consecutive days. The seller can request a tax status letter by submitting a completed form DR 0096 to the Department. If a retailer does not file a required return, there is no limit on the time for the Department to estimate the tax due and issue a notice of the estimated tax due to the retailer. The, The Department owns and maintains a publicly accessible geographic information system (GIS) and certifies qualifying electronic address databases that retailers can use to determine the local taxing jurisdictions to which taxes is owed and to calculate appropriate sales and use tax rates for individual addresses Additional information about the GIS database and a list of certified electronic address databases can be found online at, If a retailer properly uses the GIS database, a third-party database this is verified to use the most recent information provided by the GIS database, or a certified electronic address database to determine the local jurisdictions to which tax is owed for a given sale, the retailer will not be held liable for any local sales tax the retailer failed to properly collect solely as a result of an error or omission in the database. A wholesaler that makes retail sales in addition to wholesale sales is subject to the same filing requirements as retailers and must file returns and remit tax monthly or quarterly, as applicable, unless the wholesaler has received permission to file less frequently. Let us know in a single click. Individuals and businesses with specific questions should consult their tax advisors. If a retailer regularly employs accounting methods involving reporting periods other than calendar months (such as thirteen four-week periods over the course of the year), the retailer may request permission to file returns and remit tax on a filing schedule consistent with such accounting methods. A retailer will only qualify for origin sourcing if the retailer’s total retail sales of tangible personal property, commodities, and/or services in Colorado during the previous calendar year were $100,000 or less. The retailer must either file a separate return for their sales at the special event or remit the tax for such sales to the event organizer, as described above. will be refunded to the purchaser, in full or in part. In general, a sale takes place within a state-administered local taxing jurisdiction if it is delivered to the purchaser at a location within that jurisdiction. Interstate telephone and telegraph services are not subject to Colorado sales tax. The organizer must submit such list to the Department within ten days of the last day of the event. State-administered local sales taxes are reported and remitted on the same form and at the same time as state sales taxes. The organizer must inform each seller participating in the event of the various taxes and tax rates that apply to retail sales made at the event. Under this exception, all of a small retailer’s sales will be sourced to the retailer’s business location, except that any sale delivered to a location outside of Colorado will not be sourced to Colorado. The taxability of maintenance agreements and warranties sold along with tangible personal property is generally determined under the same rules as other associated service charges. If the address the retailer checked with the database was incomplete or contained errors, any resulting failure to collect the correct tax will not be considered a result of an error or omission in the database and the retailer will not be relieved of liability. Concerning certain address database systems used for any other person to pay the..., along with any applicable penalty and interest questions should consult their advisors! Alerts Sign Up for our free Email subscription service to receive notifications when new tax information website at www.colorado.gov $. 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