MAYOR LINDA GORTON RUSTY COOK
DIRECTOR
REVENUE
200 East Main St., Lexington, KY 40507 / 859.258.3340 Phone / 859.258.3309 Fax / lexingtonky.gov
The Lexington-Fayette Urban County Government Charter provides that, the 2.25% Occupational
License Fee applies to all individuals, employers and businesses in Fayette County. The rate is:
(1) 2.25% of each individual’s gross wages, salaries, commissions and other compensation
(including deferred compensation and employee contributions to Cafeteria Plans under
Section 125 of the IRC) paid to employees earned within Fayette County.
(2) 2.25% of the net profits of every business from activities conducted within Fayette County.
Additional provisions of the Ordinance are:
(1) Each employer must withhold 2.25% license fee from gross wages, salaries, commissions and
other compensation (including deferred compensation and employee contributions to
Cafeteria Plans under Section 125 of the IRC) paid to employees for services performed
within Fayette County.
(2) Each business becoming subject to the Ordinance must at the time obtain an Occupational
License. The initial fee of $100.00 must be paid at the time of registration. This minimum fee
may be used as a credit on the annual Net Profits License Fee Return (Form No. 228) when it
is filed after the close of your accounting period but it is not refundable.
The forms for required reporting are:
(1) Form No. 220/221 must be used by employers to report license fee withheld from
employees,
(a) when the total amount withheld is $300.00 or more per quarter it must be submitted
monthly,
(b) when the total amount withheld is less than $300.00 per quarter it must be submitted
quarterly.
(2) Form No. 222 must be used by employers to report annually the name, address, social
security number, compensation earned and license fee withheld of each employee.
(3) Form No. 228 must be used by each business to report annually its net profits subject to the
2.25% license fee.
Each of the three forms listed will provide further detailed information and instructions.