If you are considering launching your own business in South Carolina, it is necessary to consider knowing everything about Sales tax.
Sales tax is that extra amount of money added to a product, good, or service that a consumer will purchase in any retail store.
Each state in the United States handles its tax rate, so performing an accurate calculation can be somewhat tedious. South Carolina is no exception. Each of its counties applies its tax rate, and today we will tell you what they are.
How much is sales tax in SC?
You will most likely be required to collect sales tax when you sell certain products, goods, or services. The amount collected will be turned over to the South Carolina Department of Revenue.
This type of tax is collected through properly established points of purchase. The South Carolina sales tax rate is 6%. But each county may establish its local rates, which may add up to 3%.
Most products or services are subject to sales tax. However, necessary items such as food, medicine, and clothing are exempt.
To learn more about those products that do not include sales tax, you need to consult the list on the South Carolina Department of Revenue website. This way, you will know whether or not your business is required to collect this important tax.
Is it mandatory to collect sales tax?
As a merchant, you must pay sales tax in South Carolina if you have any nexus in this state. The nexus we refer to can be of two types: Economic or physical.
Economic nexus is when the merchant generates total income in a given state, regardless of its physical presence. It is also framed by the number of transactions made in that region.
But physical nexus is directly related to the presence of a merchant in a specific location. It also has to do with tangible activity in a particular area of South Carolina that requires the payment of sales tax.
What is it like to have physical nexus in South Carolina?
These are the qualities of a merchant with physical nexus in the state of South Carolina:
- Employed under the face-to-face mode.
- Office or establishment actively operating in South Carolina.
- Goods are stored in a separate warehouse.
- Ownership of any real or personal property.
- Delivery of any type of merchandise in taxpayer’s automobile.
- Self-employed or independent contractors are actively doing business in South Carolina.
In this way, you obtain an economic nexus
The regulations in South Carolina state that economic nexus occurs when any supplier earns more than $100,000 yearly from sales of products, goods, and services.
It also states that suppliers must collect sales tax from buyers in the region. This way, the regulation is fully complied with to avoid future inconveniences.
What is subject to sales tax?
Generally, sales tax is levied on an activity that involves the creation or development of a particular product. Tangible goods include the individual tax rate.
But there are the following exceptions:
- Certain foodstuffs.
- Medical devices.
- Prescription drugs.
- Products and machinery used for research and development.
How to file a sales tax return in SC?
You must follow these three procedures when filing your South Carolina sales tax return:
- Make a thorough calculation of the amount of sales tax due.
- File a sales tax return with the appropriate agencies.
- Execute the payment with the exact amount.
Tax rate by counties
In the next data table, you can find the sales tax rate by county.
|Abbeville County||8 %|
|Anderson County||8 %|
|Allendale County||8 %|
|Aiken County||8 %|
|Bamberg County||8 %|
|Beaufort County||9 %|
|Barnwell County||8 %|
|Berkeley County||9 %|
|Charleston County||9 %|
|Colleton County||8 %|
|Calhoun County||8 %|
|Cherokee County||8 %|
|Chester County||8 %|
|Chesterfield County||8 %|
|Clarendon County||8 %|
|Dorchester County||9 %|
|Dillon County||8 %|
|Edgefield County||8 %|
|Florencia County||8 %|
|Fairfield County||8 %|
|Greenville County||8 %|
|Georgetown County||8 %|
|Greenwood County||8 %|
|Hampton County||9 %|
|Horry County||9 %|
|Jasper County||9 %|
|Kershaw County||8 %|
|Lee County||8 %|
|Lancaster County||8 %|
|Lexington County||8 %|
|Laurens County||8 %|
|Marion County||8 %|
|McCormick County||8 %|
|Marlboro County||8 %|
|Newberry County||8 %|
|Orangeburg County||8 %|
|Oconee County||7 %|
|Pickens County||7 %|
|Richland County||8 %|
|Sumter County||8 %|
|Saluda County||8 %|
|Spartanburg County||8 %|
|Union County||8 %|
|Williamsburg County||8 %|
|York County||8 %|
For years I have studied American finance regulations. All the information in this blog is sourced from official or contrasted sources from reliable sites.
Salesforce Certified SALES & SERVICE Cloud Consultant in February 2020, Salesforce Certified Administrator (ADM-201), and Master degree in “Business Analytics & Big Data Strategy” with more than 13 years of experience in IT consulting.