Kentucky web design sales tax: why your invoice includes 6%.

The short answer

Kentucky’s House Bill 8, passed in 2022, added website design and development services and website hosting services to the list of services subject to sales tax, starting January 1, 2023. Both are still in KRS 139.200 today. The rate is 6 percent statewide, and the Department of Revenue confirms Kentucky has no local sales tax on top of it.

So when a provider who is required to collect Kentucky web design sales tax bills you for design or hosting, a 6 percent line is expected. This page explains it in plain words. It is not tax advice.

Where the tax came from

In 2022 the Kentucky General Assembly passed House Bill 8, a tax bill that, among other changes, extended the sales tax to a long list of services that had never been taxed before. The Department of Revenue set out the new services and their effective date, January 1, 2023, in its June 2022 sales tax newsletter. A follow-up bill in 2023, House Bill 360, adjusted the list. Between them, more than thirty kinds of service became taxable.

The list lives in KRS 139.200, the statute that imposes Kentucky’s sales tax. The current version, effective August 1, 2026, still includes:

• Website design and development services
• Website hosting services
• Photography and photofinishing services
• Prewritten computer software access services, meaning access to software someone else runs for you, which covers many online subscriptions

Not everything on the 2022 list survived. Marketing services were on the original list and are no longer in the statute.

What Kentucky web design sales tax means for your project

In plain terms:

• Budget for it. The tax is 6 percent of the taxable part of the project. For every thousand dollars of taxable work, that is sixty dollars.
• Hosting carries it too. A monthly or yearly hosting charge from a provider who collects the tax carries the same 6 percent.
• There is no local add-on. Louisville, Lexington and every other Kentucky city share the same state rate.
• It goes to the state. The provider adds it to your invoice and pays it to the Department of Revenue. It is separate from what the designer charges for the work.

Who has to charge it

A provider of these services generally has to register with the Kentucky Department of Revenue and collect the tax. When the tax began, the Department said the small-provider threshold in KRS 139.470(23) applied: a provider whose receipts from the newly taxable services went over 6,000 dollars in 2021 or 2022 had to be registered to collect from January 1, 2023. That was the starting test, not today’s rule. The current KRS 139.470 sets the line at 12,000 dollars of these service receipts in a calendar year. Once a provider passes it, receipts over the line are taxable that year and all receipts are taxable in later years, and the exemption does not apply to a provider that also sells goods, digital property or certain other taxable services.

A few situations work differently:

• Designers and agencies reselling the work. The Department’s own example: a web designer who hires a subcontractor to build part of a website, then sells the finished site to a client, can give the subcontractor a resale certificate. The tax is then charged on the final sale.
• Designers outside Kentucky. Whether they collect Kentucky tax depends on their own registration. The new services are subject to Kentucky’s use tax as well as its sales tax, which can matter when a taxable service is used here and no Kentucky tax was charged. Ask your accountant whether that applies to you.
• Exempt organizations. If your organization holds a Kentucky sales tax exemption, give your provider the certificate before the first invoice.

The lines that are less clear

The statute names website design and development, and website hosting. It does not define every task a web project can include. These lines deserve a question before work starts:

• Ongoing maintenance and updates
• Search engine work and content writing
• Photography for the site, which is a taxable service in its own right
• Domain registration and third-party software licenses passed through to you
• Training and consulting time

That is why a good invoice lists each item on its own line, with the tax shown separately, so everyone can see what was taxed and why. For a definite answer on a specific line, ask the Kentucky Department of Revenue or your accountant. A blog post, this one included, is not the place to settle it.

What to look for on a Kentucky web design invoice

1. Each service described on its own line, not one lump sum.
2. Sales tax shown as its own line, with the rate.
3. Hosting and ongoing care billed separately from the build, so recurring charges are easy to read.
4. A written scope before work starts that says whether the quote includes tax.

If a quote does not mention tax, ask. Six percent is easier to plan for than to discover. For the rest of what drives the price of a project, see what affects the cost of a website, and for what a good agreement should cover, see what to put in a web design contract.

Compare quotes on the same footing

Two quotes can look further apart than they are. One Kentucky designer may quote with tax included, another before tax, and an out-of-state designer may not mention Kentucky tax at all. Put every quote on the same footing, before tax and after, before you compare them.

The same goes for ongoing costs. A care plan or hosting quote should say whether tax is included, because it repeats every month or year. Website hosting costs and website maintenance costs walk through what those numbers usually cover. If you are hiring locally, how to choose a Louisville web designer covers the other questions worth asking.

Frequently asked questions

Do Kentucky web designers have to charge sales tax?

Website design and development services have been taxable in Kentucky since January 1, 2023. A provider over the state’s small-provider threshold, 12,000 dollars a year in these service receipts under current law, has to register and collect 6 percent on taxable sales.

Is website hosting taxed in Kentucky?

Yes. Website hosting services were added to the same list by House Bill 8 and are taxed at 6 percent.

Does Louisville add its own sales tax?

No. Kentucky has no local sales tax. The rate is 6 percent everywhere in the state.

Is website maintenance taxable in Kentucky?

The law names design and development, and hosting, without defining every task. Ask your provider how they treat maintenance, and ask the Department of Revenue or your accountant if you need a definite answer.

My web designer is in Indiana. Do I still owe Kentucky tax?

It depends on whether they collect Kentucky tax. If they do not, Kentucky’s use tax may apply to a taxable service used here. Your accountant can tell you for your situation.

Is this page tax advice?

No. It explains the law in plain words as of October 2026. For your own situation, talk to the Kentucky Department of Revenue or a tax professional.