Effective July 1, 2018, businesses that provide the services listed in the chart below are required to collect the 6% sales tax from their customers for providing these services. Retailers that make sales of these services must charge 6% sales tax on the full sales price charged to their customers and may claim a resale exemption on their purchase of items provided to the customer as part of the retailers' service(s). The resale exemption is limited to tangible personal property or digital property sold to and received by the customers as part of the retail sale for periods prior to July 1, 2019. However, for sales beginning on or after July 1, 2019, KRS 139.260 now provides a resale exemption for the services listed in subsections (g) through (q) of KRS 139.200, which became taxable as of July 1, 2018.
While the new sales tax requirement applies to many types of services, it does not apply to all types of services. For example, personal care services provided by barbers and hairdressers are not part of the expansion of taxable services.
Please read below for a listing of new services subject to sales tax for transactions on or after July 1, 2018 to determine if you need to register your business for a Sales and Use Tax account.
*Businesses already registered with a Kentucky sales tax account number should use their existing account and filing process to begin reporting retail sales of these new service categories for periods on or after July 1, 2018.