Colorado Exemption Form – Fill Out and Use This PDF

Colorado Exemption Form PDF Details

Form DR 0563, the Colorado Sales Tax Exemption Certificate, is issued by the Colorado Department of Revenue. It allows qualifying buyers to purchase goods and services in Colorado without paying state sales tax. The certificate applies to both state and city-level sales tax in most cases.

The following types of businesses and organizations may use Form DR 0563:

• Wholesalers and retailers purchasing goods for resale
• Manufacturers buying raw materials or equipment for production
• Charitable and religious organizations exempt under Colorado law
• Political subdivisions and government agencies
• Agricultural producers purchasing qualifying farm supplies
• Other entities exempt under a specific Colorado statute

To complete the form, provide your company name, address, and Colorado sales tax account number. List the registration or ID number for each city or state where you plan to make tax-exempt purchases. Enter this information for every jurisdiction where the exemption applies.

You must also describe what types of goods the exemption covers. State whether the items are purchased for resale, production, charitable use, or another qualifying purpose. Be specific. Vague or incomplete descriptions may cause a seller to reject your certificate.

If you later use any purchased goods for a taxable purpose, your business must report the use and pay the tax owed. This rule applies even if the original purchase was tax-exempt. Colorado law holds the buyer fully responsible for accurate reporting of any taxable use.

Sellers who receive this certificate must review it carefully before granting tax-exempt status. The certificate transfers tax liability to the buyer. An incomplete or fraudulent form does not release the seller from legal responsibility. Sellers should retain a copy of each certificate received for at least three years.

The exemption certificate does not expire automatically. Colorado recommends updating it when your business information changes. If your tax registration number changes, your exemption type changes, or your business relocates, issue an updated certificate to each of your suppliers.

Form DR 0563 must be completed accurately to comply with Colorado sales tax law. Errors, omissions, or false statements may result in back taxes, interest, and penalties for both the buyer and the seller.