Below is a list of frequently asked questions about City of Colorado Springs sales and use taxes. The City of Colorado Springs is a 'home rule' city and is authorized to levy and collect its own sales tax. The State of Colorado collects the State and El Paso County sales tax.
What is sales tax?
The sales tax is a transaction tax levied upon sales, purchases, and leases of tangible personal property and taxable services sold or leased by persons engaged in business in the City. The sales tax is collected by the retailer or lessor and remitted to the City.
When do I need a sales tax license?
A sales tax license must be obtained by any person engaged in the business of selling and/or leasing at retail within the City.
How much is the sales tax license?
$20.00 - January 1- June 30 of the even-number year
$15.00 - July 1 - December 31 of the even-number year
$10.00 - January 1- June 30 of the odd-number year
$ 5.00 - July 1 - December 31 of the odd-number year
Can I file my return online?
Yes. In the search box located in the upper right hand corner of this page type "SALES TAX ONLINE SERVICES" this will take you to the hyperlink of our online services where you are able to file a sales tax return or apply for a new sales tax license.
I only plan on selling my product for a few days. Do I still need a license?
Yes, you will need a temporary sales tax license. The application for a temporary license can be mailed to our office along with payment for the license fee and cash deposit. For quicker processing, you can bring the application into our office where we can process it immediately and assign you a temporary license number. A copy of the license should be maintained by the vendor as proof of licensing. The license fee is $20.00. Please call the office to determine the cash deposit amount before mailing. Our mailing address is: Sales Tax Division, P.O. Box 1575, Colorado Springs, CO 80901-1575. Additional questions can be answered by contacting the Sales Tax Department at (719) 385-5903.
I plan on having a garage sale. Do I still need a license? Am I required to collect sales tax?
City zoning requirements restrict garage sales to two per household per year, and they are limited to two days in length per garage sale. The first $300 of sales per year at a garage sale are exempt from City sales tax. If sales do not exceed $300 in a year, a sales tax license is not required, and City sales tax does not have to be collected.
When are my taxes due?
All returns are due on the 20th of the month following the reporting period. A return must be filed even if there is no liability.
If I am late in filing my return, is there a penalty?
If the return is filed after the 20th you must add a 10 percent penalty and interest at the applicable rate. Please call 385-5903 for the current interest rate.
What is use tax?
If you purchase furniture, fixtures, equipment (not inventory) or supplies for use, storage or consumption in the City without paying the City sales tax you owe a use tax. You owe one or the other, not both. The use tax is paid directly to the City by you, the consumer. For example, if you purchase office supplies from a direct mail catalog company outside the City and the sales tax is not collected by the seller, you must pay use tax directly to the City. Transactions specifically exempt from the City sales tax are also exempt from the City use tax.
What is a use tax account?
Any business that purchases tangible personal property for its own use, storage or consumption without the payment of the City sales tax must apply to the City for a Use Tax Account.
Is there a fee for the use tax account?
No. The account is free.
What is a Public Improvement Fee? (PIF)
Public Improvement Fees are not a sales tax. They are not administered or collected by the City of Colorado Springs.
Most often PIFs are a private fee that developers require their tenants/retailers to collect from customers. This fee is collected as part of sales transactions and is generally a percentage of the sales amount. The developer/property owner may normally implement at PIF without municipal approval.
The PIF may be used for any designated purpose but is generally used to pay for infrastructure, on-site improvements, and maintenance (examples: curbs, sidewalks, street lights, parking facilities, roads within the developed area).
Public Improvement Fees must be listed on the sales receipt as a separate line item from the sales tax.
What is the City sales or use tax rate?
January 1, 2016 to Present - 3.12% State of Colorado rate is 2.9%. El Paso County rate is 1.23%. Pikes Peak Rural Transportation Authority rate is 1%.
How long do I have to keep my sales and use tax records?
Generally, you must maintain books and records for a period of 36 months.
If I make a sale to a church or charitable organizations do I collect the tax?
No, but the burden of proof of exempt sales rest with you. Religious and charitable organizations within the City are required to have a letter of exemption provided by the City.
I overpaid my tax. How do I get a refund?
Any claims for refund must be made within 36 months from the time the tax was paid.
I am a contractor. Do I pay sales tax?
Yes, all construction materials purchased or used within the City are taxable. There is no exemption for jobs performed for government, religious or charitable organizations, since the contractor and/or subcontractor is the user of all tangible personal property used or consumed with the City. If City sales tax is not paid, City use tax is due.
My Business is in an enterprise zone. Can I get an exemption from the sales and use tax?
No, the City does not have an exemption from the sales or use tax in an enterprise zone.
I make tools. Do I have to collect a sales tax on my labor?
Yes, the sales or use tax is imposed on the full retail selling price of tangible personal property sold after manufacture or after having made to order.
I repair electronic equipment. Do I have to charge sales tax on labor?
No, if the bill (invoice) separates the parts used and labor expended, the tax may be charged on the parts only. Otherwise, the entire invoice amount is taxable.
I want to operate a business out of my home. Do I need a City sales tax license?
If you sell taxable property from your home in the City, you need a sales tax license to collect and remit City sales tax. If you operate a business from your home, you may need a Home Occupation Permit from the City Planning Department. Please call City Planning at (719) 385-5905 before applying for a sales tax license for more information on zoning requirements.
If I operate a temporary business and sell merchandise on the street, do I need a City sales tax license?
If you sell taxable tangible personal property within the City you need a sales tax license. But, if you operate a temporary business and sell from private property or on the Public Right of Way you must comply with the Temporary Use Regulations in the City code. Please contact the City Planning Office at (719) 385-5905 for more information.
FAQs - ONLINE SERVICES
Below is a list of frequently asked questions regarding our online services. Services available at this time include:
- Apply for a Sales Tax License
- Add a Location to an Existing License
- File a Tax Return
- Pay License Renewal Fee
- Pay Statement of Account (credits cannot be used online)
- View and Print License
Please Note: If your mailing address is outside the United States, you will not be able to use these services.
I want to file my return on-line. How do I do that?
You must first register by creating a new user account. You will be asked to provide some initial information such as your name, phone number, and e-mail address. A 10-digit phone number is required and must be entered without any characters (i.e. no dashes, spaces, periods, etc.). You will also create a User Name and Password. After doing so, you will then be able to log in. Logging in will permit you to file your current return.
How do I choose a User Name?
Choose a user name that is easy for you to remember and that is unique to you or your business. Don’t make it so complicated that you will forget it. The User Name is case sensitive, so if you use capital letters when it is created, you will need to use capital letters every time you log in.
Are there any requirements for the Password?
The only requirement is that it must be at least 6 characters. It is recommended that you choose letters and numbers so that your password is not easily guessed by others. The Password is case sensitive, so if you use capital letters when it is created, you will need to use capital letters every time you log in.
What happens if I forget my password?
You can reset it. On the “Home” page of Online Services, there is a link you can click to reset your password. Click on the link and provide the information requested. A new password will be sent to the e-mail address you provided when you registered.
What is my Customer ID?
Your Customer ID is the account number that appears on your City of Colorado Springs Sales Tax License. If you are currently receiving a sales tax return from our office, the Account Number is listed at the top of the form.
Why do you ask for a mailing zip code?
This helps to further authenticate your account and to prevent unauthorized users from accessing your information.
Can I have someone file and pay on my behalf?
Yes, if you have authorized that individual to do so. They will be required to register and provide the requested information above.
Why do I have to enter gross and net taxable sales?
Entering both ensures the information you have entered is mathematically correct. The data may also be used to gather certain statistical reporting information.
My tax due for the filing period is less than $1.00 and my payment was rejected when I submitted payment.
Currently, you must owe at least $1.00 in sales or use tax before your payment will be accepted. If the amount due is less than $1.00, you will have to file a paper return.
I don’t owe any tax for the filing period. Can I file online?
What happens if I make a mistake when I am entering my sales tax return numbers?
Before submitting your return, you will be asked to verify that the information entered is true and correct. You should re-check your figures at that time. Once submitted and paid, you cannot make changes on-line. If you need to make changes to the information submitted, please contact our office at 719-385-5903.
I file returns for multiple different customers. Can I use the same user name and password for all accounts?
No, you must create a username and password for each separate account.
Can I file amended returns online?
No, not at this time.
I have more than one location in the City. Can I file my consolidated return online?
What happens if I enter my return information and decide not to pay at that time?
It is recommended that you pay your return at the time you enter the information so that you don’t forget to do so later. However, in the event you need to exit, the information you have entered should still be visible when you log back in. You should not have to re-enter the information.
Why can’t I see my account history?
That option is not currently available, but we hope to offer that in the future. If you need specific information about your account, please contact our office.
Does the City of Colorado Springs charge a convenience fee for filing online?
I just applied for a sales tax license online. When am I given my account number/Cust ID?
An account number is assigned once your application has been received in our system. The information you provided online will be reviewed by the sales tax office and when approved, your sales tax license will be sent to the mailing address provided on the application. Your account number is shown on the license. Please allow 2-3 weeks for approval and mailing.