2
7.) Why does the Department of Revenue change my filing frequency?
The state’s fiscal year end is June 30
th
. On an annual basis each sales tax account is
reviewed to determine if a taxpayer needs to file more or less frequently depending on
the tax liability paid in the past year. This adjustment should not change your
bookkeeping. It only means that you have to report your sales and use tax more or less
frequently.
8.) If I refund money to a customer, do I claim this amount on line 28 (credit claimed) of my
sales and use tax return?
No. if you refund money to your customer you either send in an amended return and
ask for credit, or file a refund application (Form 51A209) requesting the money be
refunded. The credit line on your sales tax return (line 28) is for pre-authorized credits
by the DOR only.
9.) What is the Sales Tax? Who is responsible for collecting sales tax?
Sales tax is a tax on tangible personal property and digital property that is sold, leased
or rented in Kentucky and selected services. It is the seller’s responsibility to collect the
sales tax from the customers and to remit the sales tax to the Department of Revenue.
10.) What is the tax rate?
There is a six percent (6%) statewide rate. There is no local option sales tax in
Kentucky.
11.) What is the use tax rate? What is the use tax rate?
The use tax rate is a tax on tangible personal property and digital property used in
Kentucky upon which the sales tax has not been paid. In other words, it is a sort of
“backstop” for the sales tax. Property which is purchased, leased or rented outside of
Kentucky for storage, use or other consumption in this state is subject to the use tax.
Tangible personal property and digital property purchased for resale, but which is used
instead of being resold, is subject to sales and use tax. The use tax rate is six percent
(6%).
Persons who become liable for use tax are required to report and pay the tax directly to
the Department within 20 days following the end of the month in which the taxable use
occurs. Persons who occasionally incur a use tax liability and who do not hold a sales
and use tax permit may report and pay the use tax on a non-registered basis on a
Consumer’s Use Tax return, Revenue Form 51A113(0). The return may be obtained at
any Kentucky Taxpayer Service Center, by writing to the address below.
Department of Revenue
Division of Sales and Use Tax
P.O. Box 181
Frankfort, KY 40602-0181