Denver Sales and Use Tax
When is Denver Sales Tax Due?
Sales tax is due on the 20th of the month following your reporting period.
How often you file you Denver Sales Tax report depends on the amount of tax you collect.
Who must collect?
Any business selling a product or lodging in the City and County of Denver must collect sales tax. The rates vary by what you sold. Food has a different rate than goods. Most services are not taxable.
Do I need to collect sales tax in Colorado?
It depends upon the type of business you run and how you bill your clients. If you have a retail operation, then you need to collect sales tax. If you run a service business, then it depends on if you use goods in providing your service. A hair salon must pay sales tax on the goods used on clients, or file a use tax report. A graphic designer does not.
If your business is construction related such as a plumber, remodeler or other specialty trade, it all depends on how you bill. If your clients want to see an itemized bill that shows parts and labor, you need to charge for sales tax on the parts, unless you already paid sales tax when you purchased the part and you only charged what you paid. WARNING: If you charge a lump sum for parts and labor the City and County of Denver considers the total invoice taxable.
How do I know what Denver sales tax to collect?
Sales tax is like an umbrella, it you share it with the client you collect it. If you ship to a client out of state, there is no sales tax. If you ship a good to client in on the Western Slope, you collect for Colorado only. If you have a fixed location where clients buy from you, then you must collect for each sales tax umbrella in your area – state, regional, county, city, special taxing district.
If you are located in Denver and you go to a client in Jeffco, you share the following umbrellas: Colorado, RTD, and Jeffco. If the client is in Lakewood or Wheat Ridge you will need to collect for the city as well.
What is the sales tax rate for Denver, Colorado?
The total sales tax you must collect for goods sold in Denver:
- Colorado Sales Tax: 2.9%
- RTD (including special taxing) 1.2%
Denver sales tax:
- Food Sales: 4%
- Other Retail Sales: 3.62%
Aviation fuel and short-term rentals have different rates.
Denver Occupation Privilege Tax
If you do business in the City and County of Denver, you need to pay the Denver Occupation Privilege Tax (OPT) for each owner, partner and employee who works in the Denver. The current rate is $4 per month for each employee, plus an additional amount of $5.75 per month to be paid by the employee. As the employer you are responsible for paying the full amount of $9.75 per month for each person working in Denver.
Below is a collection of resources for sales tax collection and reporting in Denver.
If you need help with preparation of your Denver Sales Tax Reports, we can assist and even help train you or your employees to do your own.
- Colorado Sales Tax Form – www.colorado.gov/cms/forms/
- Denver Sales Tax Forms
- Monthly – http://www.denvergov.org/
- Quarterly – http://www.denvergov.org/
- Annual – http://www.denvergov.org/
- Denver Occupational Privilege Tax Form