New Colorado Retail Delivery Fee

Posted on

AAFCPAs would like to make clients aware, if you sell tangible property to customers located in Colorado, there is an important change coming that could significantly affect the amount of tax you need to collect from your customers.

Effective July 1, 2022, the Colorado Department of Revenue will be instituting a new Retail Delivery Fee (RDF) which will require businesses that sell taxable items delivered by any motor vehicle (either yours or a third party) to charge a fee of $.27 per retail sale. This fee must be collected from the customer in addition to any applicable sales tax and must be remitted to Colorado on a separate form (i.e., DRF 1786), with the same filing frequency and dates as your regular sales tax returns.

This fee applies to businesses that deliver any item by motor vehicle that is subject to Colorado sales tax, e.g., restaurants or grocery stores that deliver, delivery of goods like furniture or appliances, online stores that ship orders, etc.  Retailers with active sales tax accounts will automatically be registered for an RDF account and, starting July 1, will need to include the RDF as a separate charge on any invoices for taxable sales.

If you have any questions or need help managing your tax compliance, please contact Kelly Zack, MST at kzack@nullaafcpa.com, 774.512.4001; or your AAFCPAs Partner.


About the Author

Kelly Zack, MST

Kelly is a senior leader in AAFCPAs’ Commercial Tax practice. She advises individuals, partnerships, corporations, nonprofits, and trusts operating in multiple states and municipalities on opportunities to save tax dollars through advanced tax planning and risk mitigation. This includes the identification of all location-specific tax incentives and credits that could impact business entities and their owners. Kelly brings expertise in nexus analysis for income/franchise tax and sales and use taxes along with the analysis of state …