Kentucky Services Tax
On June 13, 2018 I received a letter from the Kentucky Department of Revenue dated June 11, 2018 informing me of a recent law change impacting service organizations including Prospect Pet Sitting, LLC. Effective July 1, 2018, Prospect Pet Sitting, LLC is required to collect the state’s 6% sales tax on the total sales price of services rendered. This type of tax which was previously limited to the sale of products has now been greatly expanded by the state legislature to include most kinds of service. Included herein you will find a list of common services that will now be subject to the tax as well as a link with more information. Like most business owners and consumers I am not pleased with this new law even though such measures of fiscal policy are not surprising.
Please note that the service prices for Prospect Pet Sitting, LLC are not changing. The 6% sales tax will simply be added to the total sales price for the services being performed. For those of you who have services scheduled on June 30th through at least July 1st, two invoices will be created and processed. The first invoice covering visits through June 30th will be processed in the month of June. The second invoice covering from July 1st and beyond will be processed on July 1st.
House Bill 487 applies the 6% sales tax to charges for the following services:
- Landscaping and snow removal;
- Residential and commercial cleaning services;
- Small animal veterinary services;
- Pet grooming, boarding, sitting and obedience training services;
- Non-coin-operated laundry and dry cleaning services;
- Indoor skin tanning services;
- Non-medical diet and weight reducing services;
- Limousine services, if a driver is provided;
- Linen supply services and nonindustrial uniform supply services;
- Extended warranty services for tangible personal property or digital property that is taxable to the warranty holder;
- Industrial uniform supply services, protective apparel supply services and industrial mat and rug supply services; and
- Installation/repair labor associated with the sale of taxable tangible personal property, digital property or services.
For more information, please consult the Department of Revenue website at https://taxanswers.ky.gov.