Symptoms
If you use Microsoft Outlook to access another Microsoft Exchange user’s mailbox folder(s), your ability to apply, create, or delete Outlook Categories is limited to the permissions that you have on their Calendar and other individual folders. For example, when you try to apply or remove a category on an item in a shared folder, if you have fewer than the required permissions, you receive one of the following error messages in Microsoft Outlook:
You do not have sufficient permission to perform this operation on this object. See the folder contact or your system administrator.
You don't have appropriate permission to perform this operation.
Also, if you open the Color Categories dialog box when you are in a shared folder, the New , Rename , and Delete buttons are not available (appear dimmed).
Cause
You do not have the minimum required Calendar folder permissions to create, delete, apply or remove categories. The list of color categories in a mailbox is stored in a hidden message in the Calendar folder of a mailbox. Therefore, if you are working in any shared folder of another user’s mailbox, you must have the appropriate permissions to the other user's Calendar folder to view and apply their categories, and to create new or delete existing categories in the other user’s shared folders.
Resolution
Configure the permissions that are listed in the following sections to match the level of access that you want for categories in shared folders in another user’s mailbox.
Set categories in a shared calendar when using Microsoft 365 calendar sharing
If you are not using updated Calendar Sharing in Microsoft 365, skip to the Set categories if Microsoft 365 calendar sharing is disabled or if using an Exchange on-premises mailbox section.
Tip: To determine if you are using the new Microsoft 365 updated calendar sharing model, see How to enable and disable the Outlook calendar sharing updates
If you are using updated Calendar Sharing in Microsoft 365, configure the following permissions.
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The Microsoft 365 administrator must grant the delegate Exchange Full Access permissions to the sharer's mailbox. See Manage permissions for recipients in Exchange Online.
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The sharer must grant the delegate Outlook Delegate Access permissions, as described in Allow someone else to manage your mail and calendar.
After setting the required permissions, restart Outlook.
To create or delete categories in the other user's mailbox, the delegate can click the shared Inbox folder, then click Categorize on the ribbon.
If the delegate cannot view or assign categories, they can troubleshoot by toggling Work Offline on and off. To do this, navigate to the shared calendar folder, then click the Send/Receive tab on the ribbon, click to enable Work Offline, and then click Work Offline again to disable it.
Set categories if Microsoft 365 calendar sharing is disabled or if using an Exchange on-premises mailbox
If you are using updated Calendar Sharing in Microsoft 365, please skip to the Set categories in a shared calendar when using Microsoft 365 calendar sharing section.
Apply or remove categories from items in a shared folder
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Start Outlook.
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Right-click the shared folder, and then click Properties .
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Click the Permissions tab.
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Add or click to select the user who has to work with categories in the shared folder.
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Under Permissions , click Editor or a higher permission level in the Permissions Level box, and then click OK .
Note: If you do not have Owner permissions to the Calendar folder of the user who is sharing folders, you cannot add or delete categories in the Color Categories dialog box. If you have at least Reviewer permissions to the Calendar folder, you can only apply categories to or remove categories from items in the shared folder based on the existing list of categories in the Color Categories dialog box.
Create or delete categories in a shared folder
If you want to add new categories or delegate existing categories in a shared folder, you have to have Owner permissions to the Calendar folder of the mailbox owner who is sharing their folders. To change the permissions on the Calendar folder, follow these steps on the Outlook client of the user who owns the mailbox with the shared folder(s):
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Start Outlook.
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Click Calendar in the navigation menu.
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Right-click the Calendar folder, and then, click Properties .
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Click the Permissions tab.
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Add or click to select the user who has to manage categories in the shared folder.
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Under Permissions , click to select Owner in the Permissions Level box, and then click OK .
Rename categories in a shared folder
Even if you have Owner permissions to the Calendar folder of the user who is sharing folders, the Rename button is always disabled in the Color Categories dialog box for someone other than the mailbox owner. When you rename a category in the Color Categories dialog box Outlook has to examine every categorized item in every folder to rename the category, if appropriate. Because of this, only the mailbox owner can rename a category displayed in the Color Categories dialog box. Please ask the owner of the shared folder to rename the category if you must have a category renamed.
