Credit card processing and merchant services in Lexington, KY
Lexington adds nothing to Kentucky's 6% sales tax at the register. The urban county's charge is an occupational license fee, with a $100 initial license and a $100 annual minimum after that.
A Lexington checkout needs one sales tax rate, Kentucky's 6%. The Department of Revenue says there are no local sales and use taxes anywhere in the state, so the Lexington-Fayette Urban County Government adds nothing at the register, and a taxable order you ship to a customer in another Kentucky county carries the same 6%.
The urban county government collects its share another way, through an occupational license fee. Its Code of Ordinances says every person or business entity engaged in business for profit files and pays the fee, and a business entity's net profit is part of what it's figured on. Before you open, you need an initial license from the division of revenue, at $100. In later years a $100 minimum is due by the net profit return deadline; it counts toward that year's fee but is never refunded. Sole proprietors reporting gross receipts of $4,400 or less skip that minimum after their first license. Confirm the current fee rate and forms before you file.
If you also have a location in Louisville, plan for that city's tax too. Louisville Metro's occupational license tax on net profits totals 2.2%, and our Louisville page has the breakdown. Sales tax stays at 6% in both places.
The Census Bureau estimated 329,751 residents for Lexington-Fayette in July 2025, up 2.2% since 2020. Kentucky has no surcharge statute that we know of, so Visa's 3% and Mastercard's 4% caps apply, with nothing on debit; our Kentucky page covers the network rules. For a dental office or a law firm, the bigger question is usually the processing bill itself. We price on interchange-plus and set up a virtual terminal for invoices and payment plans. A free statement review shows where your current rate stands.
Rules that matter in Lexington
Lexington-Fayette occupational license fee
Section 13-4 of the Lexington-Fayette Urban County Government's Code of Ordinances requires every person or business entity engaged in any business for profit in the urban county to file and pay the occupational license fee, and a business entity's net profit is part of the base it's figured on.
Under section 13-9, every person and business entity must get an initial occupational license from the division of revenue before starting business, at a fee of $100. In each later year, a $100 annual minimum is due by the net profit return deadline. It counts toward any net profit fee owed for that tax year but is never refunded. Individuals and sole proprietorships reporting gross receipts of $4,400 or less for a tax year don't pay the annual minimum after their initial license, or the net profit fee for that year.
Sources: Lexington-Fayette Urban County Government Code of Ordinances, Sec. 13-4: Who must obtain; basis of computation; Lexington-Fayette Urban County Government Code of Ordinances, Sec. 13-9: Initial fee
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Common questions
Who has to pay Lexington-Fayette's occupational license fee?
Every person or business entity engaged in business for profit in the urban county files and pays it, under section 13-4 of the Lexington-Fayette code, and a business entity's net profit is part of the base. Before you start, you also need a $100 initial occupational license from the division of revenue. Check the current fee rate and forms before you file.
Do I owe Lexington's $100 minimum license fee if my business is small?
Usually. After the $100 initial license, the code sets a $100 annual minimum, due by the net profit return deadline, that counts toward that year's net profit fee but is never refunded. Individuals and sole proprietorships reporting gross receipts of $4,400 or less for a tax year don't pay the annual minimum after their initial license, or the net profit fee for that year.
Does Lexington charge more sales tax than Louisville?
No. Both charge Kentucky's 6%, because the Department of Revenue says there are no local sales and use taxes in the state. The local differences are on the income side: Lexington-Fayette has its own occupational license fee and annual net profits return, and Louisville Metro's occupational license tax on net profits totals 2.2%.
How can a Lexington medical or dental office collect patient balances by card?
Email statements with a payment link, take card numbers by phone through a virtual terminal, or set up recurring billing for payment plans. At the front desk, a countertop terminal handles chip and tap. Our medical and dental page covers practice setups, all on interchange-plus pricing.
Disclaimer: general information, not professional advice
This page is general educational information, not legal, tax, accounting or financial advice. Rules and rates vary by place and change, so confirm them with the official source and a qualified professional before you act. Full terms are in our Terms of Service.
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