- What is Colorado Retail Delivery Fee?
- How to reflect this fee properly in my books?
- How does Synder handle the Colorado Retail Delivery Fee?
What is Colorado Retail Delivery Fee?
On July 1, 2022, Colorado imposed a retail delivery fee of $0.27 on all deliveries by motor vehicle to a location in Colorado with at least one item of tangible personal property subject to state sales or use tax.
The retailer or marketplace facilitator that collects the sales or use tax on the tangible personal property sold and delivered, including delivery by a third party, is liable to collect and remit the retail delivery fee. Deliveries include when any taxable goods are mailed, shipped, or otherwise delivered by motor vehicle to a purchaser in Colorado.
So basically, the Colorado Retail Delivery Fee is a tax, but unlike most sales taxes, it is not percent-based but rather is a fixed amount you’re charged on every order that you ship to Colorado.
How to reflect this fee properly in my books?
Given that it is a ‘kind of’ tax, it should be reflected as a liability in your books. However, it is a flat fee so if you just put it into the sales tax field, the tax amount will be off by $0.27 compared to what it should be judging by the tax rate.
Is there a solution? Enter Synder.
How does Synder handle the Colorado Retail Delivery Fee?
When Synder detects a Colorado Retail Delivery Fee in a transaction, it is synced as a non-taxable line item. The name of this line item and the account to which it’s posted depend on how the organization handles taxes.
If taxes are remitted by the marketplace (taxes withheld):
Synder creates a line item named “Retail Delivery Fee Withheld” and posts it to the taxes withheld account selected in Synder → Taxes settings.
Along with the line on the sale that represents your remitted taxes, we will also have an offsetting line on the expense, affecting the same tax category. This makes sure that no liabilities show up on your books due to the taxes remitted by marketplaces.
Visit this section of our help center for more details on how Synder organizes your withheld tax
If taxes are not withheld:
Synder creates a line item named “Retail Delivery Fee.” When this item is created, it’s assigned to the category defined in Taxes → Retail Delivery Fee Payable Account
This way, both remitted and the taxes you are liable for will correctly impact your accounting ledger
Reach out to the Synder Team via online support chat, phone, or email with any questions you have – we’re always happy to help you!
