How to Start a Hair Salon in Kentucky (2026)

Last updated: February 25, 2026

Opening a hair salon in Kentucky requires licensing at both the individual and establishment level through the Kentucky Board of Cosmetology (KBC). Individual cosmetologists must complete 1,500 hours of approved school training, pass both a theory and practical exam through PSI Services (each scored at 70% minimum), and pay a $50 initial license fee. Salon owners must also obtain a separate beauty salon permit ($100 initial, $200 renewal) for the establishment itself. Licenses renew annually in July with 6 hours of continuing education required. Kentucky salon services are not subject to sales tax – but product sales are taxable at 6%.

Hair Salon Requirements in Kentucky at a Glance

Requirement	Agency	Cost	Timeline
Cosmetology School Training	KBC-approved school	$10,000-$20,000 tuition	1,500 hours (approx. 12-18 months)
Theory Exam (PSI)	PSI Services LLC	$85	Computer-based; 70% passing score
Practical Exam (PSI)	PSI Services LLC	$85	After passing theory; 70% passing score
Individual Cosmetologist License (initial)	Kentucky Board of Cosmetology	$50	After passing both exams
Individual License Renewal	Kentucky Board of Cosmetology	$100/year	July 1-31 annually; 6 CE hours required
Beauty Salon Permit (initial)	Kentucky Board of Cosmetology	$100	Required before opening
Beauty Salon Permit Renewal	Kentucky Board of Cosmetology	$200/year	July 1-31 annually
LLC Formation	Kentucky Secretary of State	$40	2-5 business days
LLET (annual)	Kentucky Dept. of Revenue	$175/year minimum	Annual with tax return
Workers’ Compensation (if any employees)	Private insurers	Varies	Required at first hire

How to Start a Hair Salon in Kentucky (Step by Step)

Step 1: Complete 1,500 Hours of Cosmetology Training

Every Kentucky cosmetologist must graduate from a Board-approved cosmetology school with a minimum of 1,500 clock hours of training. Schools offer programs ranging from the 1,500-hour minimum to 1,800 hours. Programs cover theory and practical skills in haircutting, coloring, chemical services, skin care, nail care, and salon management. You must have a high school diploma or GED to enroll.

Important: Register for your exams through PSI at least 8 months before your expected graduation date. Your theory exam results are valid for 90 days once you receive notification, so timing matters.

Step 2: Pass Both Licensing Exams

Exams are administered by PSI Services LLC. Both exams require a minimum passing score of 70%.

Theory Exam: $85; computer-based; covers cosmetology science, safety, and Kentucky law; you must pass this before applying for the practical exam
Practical Exam: $85; mannequin-based performance exam covering hair, skin, and nail services
Retakes: Allowed after a one-month waiting period; each attempt costs $85

Total exam cost for first-time test-takers: $170

Step 3: Apply for Your Individual Cosmetologist License

After passing both exams, apply to the Kentucky Board of Cosmetology for your individual cosmetologist license:

Initial license fee: $50
Annual renewal fee: $100 (due July 1-31 each year)
Continuing education: 6 clock hours per year required for renewal
Licenses expire July 31; restoration fee of $50 applies if you miss the renewal window

Step 4: Form Your Business Entity and Secure a Location

Register an LLC with the Kentucky Secretary of State FastTrack portal for $40. Obtain a federal EIN from IRS.gov. Then find a commercial space that will pass KBC’s facility inspection. Requirements include:

Separate shampoo bowls from styling stations
Proper sanitation equipment for implements
Adequate lighting and ventilation
Clean and sanitary surfaces
Posted license certificates visible to clients

Step 5: Apply for Your Beauty Salon Establishment Permit

The physical salon location requires a separate beauty salon permit from the Kentucky Board of Cosmetology – your individual cosmetologist license alone is not enough to open a salon.

Initial permit fee: $100
Annual renewal fee: $200 (due July 1-31)
A KBC inspector will inspect the premises before the permit is issued
Restoration fee of $100 applies if permit lapses

Step 6: Register for Taxes

Salon services are NOT taxable in Kentucky – no sales tax on haircuts, coloring, chemical services, etc.
Product sales ARE taxable – if you sell shampoo, conditioner, or other retail products, collect and remit 6% sales tax on those sales
Register for employee withholding and the LLET ($175/year minimum) as an LLC

Cost to Start a Hair Salon in Kentucky

Item	Cost	Notes
Cosmetology School Tuition	$10,000-$20,000	1,500-hour program; financial aid available
Theory Exam (PSI)	$85	Per attempt
Practical Exam (PSI)	$85	Per attempt
Initial Cosmetologist License	$50	One-time; KBC
Annual License Renewal	$100/year	Plus 6 CE hours
Beauty Salon Permit (initial)	$100	One-time; KBC
Beauty Salon Permit Renewal	$200/year	Annual; KBC
LLC Formation	$40	One-time; Secretary of State
LLET (annual)	$175/year	Kentucky LLC entity tax
Salon Build-Out and Equipment	$15,000-$75,000+	Styling chairs, shampoo bowls, mirrors, stations
General Liability Insurance	$500-$1,500/year	Recommended; some landlords require it

Estimated total licensing and formation cost (excluding school and build-out): $560-$650

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Frequently Asked Questions

How many hours of school do you need to become a cosmetologist in Kentucky?

Kentucky requires 1,500 clock hours of training at a Board of Cosmetology-approved cosmetology school. Most schools offer programs of 1,500-1,800 hours. After completing school, you must pass both a theory exam and a practical exam through PSI Services with a minimum 70% score on each before you can apply for your license.

How much does a Kentucky cosmetology exam cost?

Each PSI exam costs $85 per attempt. There are two exams: a theory (written/computer-based) exam and a practical (mannequin-based) exam. You must pass the theory exam before applying for the practical. Total cost for first-time test-takers is $170. Retakes are allowed after a one-month waiting period, each costing another $85.

Do I need a salon permit separate from my cosmetologist license?

Yes. Your individual cosmetologist license permits you to practice cosmetology, but opening a salon requires a separate beauty salon establishment permit from the Kentucky Board of Cosmetology. The initial permit costs $100 and renews annually for $200. A KBC inspector will inspect your premises before the permit is issued.

When do Kentucky cosmetology licenses renew?

Kentucky cosmetology licenses and salon permits renew annually from July 1 through July 31. Licenses and permits expire on July 31 if not renewed. You must complete 6 clock hours of continuing education each year to renew your individual cosmetologist license. If you miss the renewal window, a $50 restoration fee applies for individual licenses; $100 for salon permits.

Are hair salon services taxable in Kentucky?

No. Hair salon services are not subject to Kentucky sales tax. Haircuts, coloring, chemical treatments, and other salon services are exempt. However, if you sell retail products (shampoo, conditioner, styling products) directly to clients, those product sales are taxable at Kentucky’s 6% rate. Register for a sales tax permit if you sell retail products.

Can I rent a booth at a salon instead of opening my own in Kentucky?

Yes. Booth rental is a common arrangement for independent cosmetologists in Kentucky. You still need your individual cosmetologist license, but you rent a station from the salon owner who holds the establishment permit. As a booth renter, you are typically considered an independent contractor responsible for your own taxes, including the $175/year LLET if you operate as an LLC.

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About the Author

Robert Smith has run a licensed private investigation firm for 8 years from the Florida-Georgia state line - where he learned firsthand how wildly business licensing rules differ between states just miles apart. He personally researched requirements across all 50 states and D.C., reviewing hundreds of government sources over hundreds of hours to build guides he wished existed when he started. Not a lawyer or accountant - just a business owner who has done the research so you don't have to.

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