The Arvada Municipal Code imposes a sales tax on the price paid for items sold at retail in the City of Arvada (COA). If sales and use tax was not paid to the COA or another municipality, Arvada use tax is due. The taxable price is the amount of money received or due, including shipping charges.
Tax is due based on the location of the catered event.
Caterers may purchase food and certain catering supplies exempt from sales tax if those items are for resale or for rent. Sales tax must be charged and collected by the caterer from the purchaser. Exempt purchases may include, but are not limited to:
- onetime use or rented items like:
- chafing or serving dishes
- eating utensils
Items for direct use by the catering company and not for resale are subject to sales tax to the caterer at the time of purchase. If no sales tax was paid at the time of purchase, use tax applies. Arvada will give credit for other lawfully imposed municipal sales tax paid up to the amount of the Arvada rate on purchases made by the caterers.
Examples of non‐exempt purchases include, but are not limited to:
- pots and pans
- steam tables
- storage containers
Caterers are liable for the tax on the total price of items that are essential to providing the meals and beverages. Sales tax must be listed on the customer invoice and may not be absorbed into the total price. Some examples of essential charges subject to tax include, but are not limited to:
- set‐up and tear‐down
- staff to serve food
- rental of chairs, linens, serving pieces
- flowers, decorations or centerpieces
Delivery charges listed on the customer invoice are subject to Arvada sales tax if delivery is within Arvada.
1. Company A, an Arvada business, is holding a Holiday Party at their business location to thank their employees for a profitable year. It has hired Catering Company B, located outside the City. The caterer provides and delivers:
- food and beverages
- tables, chairs, and linens
- glassware and silverware
They also provide two employees that will serve food on the buffet line, one bartender and one table busser. The total charges are $800.00 for the food and beverage, $250.00 for the rentals and a $200.00 service charge for the wait staff. The total of $1,250.00 is subject to Arvada sales tax.
2. An Arvada resident hires Caterer C to supply the food for a family reunion. The caterer delivers the food to the resident’s home. The charges are $350.00 for the food and a $25.00 delivery charge. Both the food and delivery charge for a total of $375.00 is subject to Arvada sales tax.
Charitable organizations may provide a caterer with a tax exempt certificate and buy food without paying sales tax. However, if the food is for a fundraising event and attendees are required to pay, the caterer must charge sales tax. The tax rate is based on the location of the event.
*This information is a summary in layman's terms of the relevant Arvada tax law for this subject, industry, or business segment. It is not intended for legal purposes to be substituted for the full text of the Arvada tax code. However, the tax guide shall be used in conjunction with the Arvada tax code (chapter 98) in determining tax liability.
- by Finance