Department of Finance
Sales Tax Division
TAX COMPLIANCE GUIDE
4800 West 92nd Avenue • Westminster, CO 80031
Office (303) 658-2065 • Fax (303) 706-3923
LINEN RENTAL & SERVICE
The Westminster Municipal Code includes in the definition of “purchase or sale” any “lease, lease-
purchase agreement, rental, or grant of a license, including royalty agreements, to use tangible personal
property or taxable services”. Retailers providing linens, diapers, uniforms, floor mats, and other textiles
along with the service of laundering soiled linens, must obtain a Westminster Sales & Use Tax License
and collect tax on the charges for rental. If a retailer fails to collect Westminster sales tax, the purchaser
must remit a use tax directly to the City.
Although these transactions may be referred to as “linen services” or other similar “services”, the object
of the transaction is the rental of the retailer’s linens and the transaction is, therefore, subject to
Westminster tax. Westminster sales/use tax does not have to be paid by licensed retailers when
purchasing textile inventory if the property will be held strictly for customer use. Retailers may not avoid
the collection of sales tax by paying a sales or use tax upon the purchase of inventory.
Charges for laundering customer-owned textiles are not subject to tax.
1. Phillip owns an upscale restaurant in Westminster. Phillip purchases “linen services” from ABC
Textiles. For a flat monthly fee ABC provides weekly deliveries of table cloths, napkins, kitchen staff
uniforms, and kitchen mats. When delivering fresh linens, ABC removes and launders the soiled
linens. ABC owns all of the linens. ABC must obtain a Westminster Sales & Use Tax License and
collect Westminster sales tax on the monthly charge.
2. A Westminster hotel hires ABC Textiles to launder and press its bed and bath linens. The hotel owns
the linens and collects them in laundry bins, which ABC removes daily. ABC charges th