Sales Tax

Sales tax is a tax on the sale of tangible personal property and specific taxable services as defined in the City of Greeley Municipal Code. Use tax is complementary to sales tax and is only due if a purchaser did not pay Greeley sales tax or a legally imposed sales tax as high or higher than the sales tax they would have paid had they purchased the item or service in Greeley.

The City of Greeley Sales and Use Tax rate is 4.11%. (3.46% prior to January 1, 2016). However, the City of Greeley Sales and Use Tax for Food for Home Consumption is 3.46%.

In addition to the City of Greeley Sales and Use Tax, the State of Colorado also has a 2.9% Sales and Use Tax. The City of Greeley only administers the Greeley Sales and Use Tax. The State of Colorado Sales and Use Tax is administered by the State of Colorado Department of Revenue. The total Sales and Use tax rates in Greeley as of January 1, 2016 are as follows:

Food for Home Consumption

Any business that is engaged in business in Greeley and is making Retail Sales must have a City of Greeley Sales Tax License and must collect sales tax on taxable sales in Greeley and file Sales and Use Tax Returns with the City of Greeley. It is important to note that depending on your business practices you can be engaged in business in Greeley even if you do not have a physical location in the City of Greeley.

Engaged in business is defined in the City of Greeley Municipal Code as follows: Engaged in business in the City means performing or providing services or selling, leasing, renting, delivering or installing tangible personal property for storage, use or consumption within the City. Engaged in business in the City includes, but is not limited to, any one of the following activities by a person:

• Directly, indirectly or by a subsidiary maintains a building, store, office, salesroom, warehouse or other place of business within the taxing jurisdiction.
• Sends one or more employees, agents or commissioned sales persons into the taxing jurisdiction to solicit business or to install, assemble repair, service or assist in the use of its products or for demonstration or other reasons.
• Maintains one or more employees, agents or commissioned sales persons on duty at a location within the taxing jurisdiction.
• Owns, leases, rents or otherwise exercises control over real or personal property within the taxing jurisdiction.
• Makes more than one delivery into the taxing jurisdiction within a twelve-month period.

All retailers engaged in business in Greeley must file sales and use tax returns. These returns may be monthly, quarterly or annual based upon guidelines as set by the City of Greeley. These returns are used to report the sales tax you have collected as well as purchases you have made subject to use tax.

Any taxpayer that makes a purchase of a taxable item or service that they are the consumer of (they are not reselling) owes Greeley Use Tax providing the following apply:

• The taxpayer is not an exempt organization.
• The taxable item or service was used, stored or consumed in Greeley.
• Did not pay to the vendor they purchased the item or service from either the Greeley sales tax rate or a legally imposed sales tax as high or higher than the sales tax they would have paid had they purchased the item or service in Greeley on all taxable amounts of the purchase.

The City of Greeley Municipal Code imposes Sales and Use Tax on the sale at retail or in the case of Use Tax the storage, use or consumption of Tangible Personal Property and Taxable Services as stated in the Municipal Code. Examples of Tangible Personal Property would be Furniture, Electronics, Cars and Clothing. If the property/item is not permanently attached to real estate then it would generally be considered Tangible Personal Property. Other common items and service that are taxable in Greeley include but are not limited to the following:

• Software
• Food
• Lodging
• Cable TV
• Gas and Electric Service
• Cover Charges
• Phone Service
• Leases and/or Rental of Tangible Personal Property
• Freight and/or Delivery Charges for Taxable Tangible Personal Property

The City of Greeley Municipal Code does exempt certain items and transactions from Greeley Sales and Use Tax. These exemptions include but are not limited to the following:

• Newspapers
• Prescription Drugs
• Gasoline or Diesel for Highway Use
• Seeds and Feed for Commercial Operations
• Cigarettes (Chewing tobacco is taxable)
• Labor Charges Separately Stated (Freight is taxable)

Resale: Sales of items that are purchased for resale are exempt provided the items being purchased are being resold by a business that actually resales the item in question. For example, a restaurant can purchase food items tax free for resale as they sell those items but they can’t purchase cleaning supplies tax free as they do not resell those items.

Government: Sales to the Federal Government, the State of Colorado and to local government (cities, counties, districts etc.) in Colorado is also exempt. Sales to out of State government is not exempt.

Non-Profit: Sales to qualified non-profits is exempt provided the organization is using the items in the normal course of their non-profit activities.

The burden on proving that any customer is exempt from tax is on the retailer making the sale. As such, it is critical that all exempt sales to a customer claiming exemption be fully documented. The City of Greeley along with other Home Rule Cities in Colorado will accept what is called the “Standard Municipal Home Rule Affidavit” which is a form that if properly filled out and completed would properly document the sale. This form is available on the City of Greeley website. However, please be advised that if the sale is not actually exempt the form does not relive the taxpayer of their obligation to have collected the tax.

If the project requires a City of Greeley Building Permit a valuation of the project is done by the Building Inspection Department. If the project is valued at $75,000.00 or less per unit then 45% of the valuation is estimated to be materials and Greely use tax is collected on that amount. If the valuation per unit exceed $75,000.00 then 50% of the valuation is determined to be materials subject to tax.

For example:

Valuation is $100,000.00 X 50% = $50,000 materials x 4.11% Greeley tax = $2,055.00 Tax

Please note that the tax collected on the permit is an estimate and the City of Greeley may at the conclusion of the project perform an audit to determine the actual amount of materials that were used. This amount is then compared back to the tax paid on the permit and will typically result in no additional tax due, additional tax is due or a refund.

If tax has been paid on the building permit then when making purchases of construction materials for the project, the permit should be presented to the materials supplier in order to avoid being charged a City sales tax by the supplier. It should be noted that the tax paid on the permit does not entitle the purchaser to buy tools, equipment and other supplies that do not become incorporated into the building tax free.

If the project does not require a City of Greeley building permit than all purchases of materials would be subject to Greeley sales and use tax like any other purchase.

In Colorado, including the City of Greeley, automobiles are treated slightly different than other purchases in regards to what tax is collected when they are purchased/sold. Normally, what tax is due is based on the location where title or possession takes place but with automobiles it is based on the address the vehicle will be registered which is the primary residence of the purchaser.

If the vehicle is purchased from a private seller, when the purchaser titles and register the vehicle at their County Department of Motor Vehicles the County will collect the correct tax including Greeley tax if the purchaser’s primary residence is in Greeley.

If the vehicle is purchased from a dealer the dealer may collect the tax and remit it to the City of Greeley. When the purchaser titles and registers the vehicle at their County Department of Motor Vehicles, the County will verify if the dealer collected the Greeley tax and if not they will collect it at that time assuming the purchasers primary residence is in Greeley

If a retailer located in Greeley makes a retail taxable sales but ships the item to the customer to a location outside of Greeley then Greely sales tax would not be due if title OR possession of the item does not pass to the purchaser until the item purchased is delivered to the customer outside of the City of Greeley.

If it is a manufacturer’s coupon (issued by the manufacturer of the product) tax is due on the sales price before the coupon is applied since the retailer is reimbursed by the manufacturer for the coupon. In store coupons (issued by the retailer) tax is due on the sales price after the coupon is applied as the retailer is not getting reimbursed and the discounted price is the true selling price.

Warranties and maintenance agreements are taxable based on the type of agreement as follows:

Manufacturers Initial Warranty: The cost of the warranty is included in the original selling price of the item sold and tax was collected on that item. No tax is due on parts used to perform repairs under this type of warranty.

Optional Warranty or Maintenance Agreement (not including Software Agreements): Since the warranty is optional no tax is due on the sales price of the warranty. However, Greeley sales or use is due on parts used to make repairs or maintenance. The responsibility to pay the tax is on the person or company performing the repair work.

Mandatory Warranty or Maintenance Agreement: If this type of agreement was required in order to purchase the item that agreement covers then the price of the agreement or warranty is subject to Greeley sales and use tax. No Greeley sales or use tax would be due on parts used to perform repairs or maintenance.

Optional Software Maintenance Agreements or Optional Hardware Maintenance Agreements that Include Software Updates: If the agreement entitle the purchase to software updates and upgrades then the purchase price of the agreement is subject to Greeley sales and use tax.

Optional Hardware Maintenance Agreements That Include Supplies: If the agreement includes supplies (example: copier hardware agreement that includes toner and paper) Greeley sales or use tax would be due on the full sales price of the agreement if the invoice to the customer does not separate out the price of the supplies versus the maintenance portion. If the invoice is separated out then Greeley sales or use tax is due on the sales price of the supplies and Greeley sales or use tax would be due on any parts used to perform the maintenance.

As a general rule, the State of Colorado has more exemptions than the City of Greeley. Here are some items and service that are taxable in Greeley but are not taxable to the State of Colorado:

• Software downloaded electronically and software maintenance agreements
• Food for Home Consumption (Greeley taxes at 3.46%)
• Electricity, Gas, Steam for Domestic Home Use
• Cable TV
• Interstate and International Phone Service

The City of Greeley does conduct audits of taxpayers as authorized in the Greeley Municipal Code. The focus of audits is to educate taxpayers, ensure compliance and to make sure there is a level playing field for all taxpayers. Audits generally result in either no tax due, additional tax due or a refund. Audits are conducted professionally and using generally accepted auditing procedures.

City of Greeley

970-350-9733
Greeley.SalesTax@greeleygov.com

State of Colorado
303-238-SERV (7378)

Short-term rentals are generally classified as a rental for compensation of a resident’s dwelling unit to a visitor for less than 30 continuous nights or more than 30 nights in any calendar year.

Operators of accessory short-term rentals must obtain required licenses and permits, such as a business license.

Operators of accessory or primary short-term rentals must collect the required State of Colorado Sales Tax (2.9%), City of Greeley Sales Tax (4.11%), and City of Greeley Lodging Tax (3%), resulting in a total collection of 10.1% for sales and lodging taxes.

• Effective November 1, 2022, any government fee imposed directly on the purchaser and required to be held in trust by the imposing government body and separately stated on the invoice provided to the purchaser is exempt from City of Greeley sales and use tax. This exemption will apply to the State of Colorado retail delivery fee and carryout bag fee.

Remittance Process

Returns are due on the 20th day of the month, following the reporting quarter. The return is due the next business day if the 20th is on a Saturday, Sunday, or legal holiday.

• 1st Quarter (January-March): April 20th
• 2nd Quarter (April-June): July 20th
• 3rd Quarter (July-September): October 20th
• 4th Quarter (October-December): January 20th

Disposable Bag Fee Return Form