SOUTH CAROLINA SALES AND USE TAX MANUAL

SOUTH CAROLINA

SALES AND USE TAX

MANUAL

2019 EDITION (THROUGH THE 2018 SESSION OF THE GENERAL ASSEMBLY)

SOUTH CAROLINA DEPARTMENT OF REVENUE

POLICY DIVISION

Go

o

W. Hartley Powell, D

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Introduction

The purpose of this sales and use tax manual is to provide businesses, Department of Revenue

employees and tax professionals a central summary of information concerning South Carolina¡¯s

sales and use tax law and regulations. To that end, the manual references specific authority,

including the law, regulations, court cases, Attorney General Opinions, and Department advisory

opinions. 1

While it is not possible to discuss every issue, this manual strives to deal with a variety of issues.

In addition, due to changes in tax law as well as new court decisions, this manual is a constant

¡°work-in-progress.¡± With that in mind, your suggestions for improvements and areas of

discussion for future editions are welcomed.

Disclaimer

This publication is written in general terms for widest possible use and may not contain all the

specific requirements or provisions of authority. It is intended as a guide only, and the

application of its contents to specific situations will depend on the particular circumstances

involved. This publication does not constitute tax, legal, or other advice and may not be relied on

as a substitute for obtaining professional advice or for researching up to date original sources of

authority. Nothing in this publication supersedes, alters, or otherwise changes provisions of the

South Carolina code, regulations, or Department advisory opinions. This publication does not

represent official Department policy. The Department would appreciate any comments or

notification of any errors. Such comments should be sent to Corey Smith or Walter Tarcza at:

South Carolina Department of Revenue

Post Office Box 12265

Columbia, SC 29211

Corey.Smith@dor.

Walter.Tarcza@dor.

This book is up to date as of December 2018. Legislation passed, cases decided, or Department

advisory opinions issued after that date are not reflected in this publication unless otherwise

specified.

1

Department advisory opinions include revenue rulings, revenue procedures, private letter rulings, technical advice

memorandums and information letters.

References

Department Website. This publication cites many South Carolina code sections, regulations,

attorney general opinions, and Department advisory opinions (Revenue Procedures, Revenue

Rulings, etc.) The full text of these references is available through the Department¡¯s website at:

dor..

Advisory Opinions by E-Mail. The Department has an ¡°Advisory Opinion E-Mail Subscription

Service.¡± Persons who sign up for this free service will automatically receive draft, temporary,

and final Revenue Rulings and Revenue Procedures, and final Private Letter Rulings and

Information Letters by e-mail. These statements provide guidance concerning the application of

laws administered by the Department. To sign up, go to the Department¡¯s website and click on

¡°Resources,¡± then ¡°Law & Policy,¡± and then ¡°Sign up to receive Policy emails.¡±

Advisory Opinion Index. Advisory opinions issued by the Department are available on the

Department¡¯s website and are indexed by both tax type and calendar year. To view these

indexes, click on ¡°Resources,¡± then ¡°Law & Policy.¡±

Other Sites. Also available through the Department¡¯s website are Administrative Law Court

decisions and proposed legislation at the General Assembly. These sites can be accessed from

the Department¡¯s website by clicking on ¡°Resources,¡± then ¡°Law & Policy,¡± and then ¡°Helpful

Links.¡±

Acknowledgements

We would like to thank Hartley Powell, Director of the South Carolina Department of Revenue,

and Deana West, Deputy Director over Policy.

We would also like to thank others who worked on and assisted with this publication including

John McCormack, Jerilynn VanStory, Andrew Saleeby, Bob Thomas, Terry Carter, and the

many Department employees and retirees who contributed to this publication over the years.

We would also like to express a special thanks to Richard Handel and Harry Cooper whose

visions were the genesis for this project and Susan Shumpert who each year makes this manual

and its publication possible.

Table of Contents

Chapter

Page

1. Chapter 1 ¨C General Overview

A. History........................................................................................

B. Rates and Impositions ................................................................

C. Local Sales and Use Taxes.........................................................

D. Local Taxes Administered by the Department ..........................

E. Local Taxes Administered by Local Governments....................

F. Exclusions ..................................................................................

G. Partial Exemptions .....................................................................

H. Full Exemptions .........................................................................

Chapter 1, Page 1

Chapter 1, Page 2

Chapter 1, Page 3

Chapter 1, Page 3

Chapter 1, Page 5

Chapter 1, Page 6

Chapter 1, Page 8

Chapter 1, Page 9

2. Chapter 2 ¨C Sales Tax Impositions

A. General Sales Tax Imposition ....................................................

B. Definitions..................................................................................

C. Summary of the General Sales Tax Imposition .........................

D. Special Sales Tax Impositions ...................................................

E. Sales to Individuals 85 Years of Age and Older ........................

Chapter 2, Page 1

Chapter 2, Page 2

Chapter 2, Page 3

Chapter 2, Page 4

Chapter 2, Page 10

3. Chapter 3 ¨C Use Tax Impositions

A. General Use Tax Imposition ......................................................

B. Definitions..................................................................................

C. Summary of the General Use Tax Imposition ...........................

D. Special Use Tax Impositions .....................................................

E. Temporary Storage ¨C Exclusion from the Use Tax ....................

F. Sales to, or Purchases by, Individuals 85 Years of Age

and Older ................................................................................

Chapter 3, Page 1

Chapter 3, Page 4

Chapter 3, Page 6

Chapter 3, Page 6

Chapter 3, Page 11

Chapter 3, Page 13

4. Chapter 4 ¨C Casual Excise Tax

A. General Information ...................................................................

B. Examples of Exempt Transfers ..................................................

C. Sales to Individuals 85 Years of Age and Older ........................

Chapter 4, Page 1

Chapter 4, Page 3

Chapter 4, Page 5

5. Chapter 5 ¨C Sales or Purchases at Retail .......................................

Chapter 5, Page 1

6. Chapter 6 ¨C ¡°Gross Proceeds of Sale¡± and ¡°Sales Price¡±

A. Gross Proceeds and Sales Price - What is Includable? ..............

B. Examples of Charges Included in ¡°Gross Proceeds¡±

and ¡°Sales Price¡±....................................................................

C. Gross Proceeds and Sales Price - What is Not Includable? .......

D. Examples of Charges not Included in ¡°Gross Proceeds¡±

and ¡°Sales Price¡±....................................................................

Chapter 6, Page 1

Chapter 6, Page 2

Chapter 6, Page 7

Chapter 6, Page 9

Chapter

Page

6. Chapter 6 ¨C ¡°Gross Proceeds of Sale¡± and ¡°Sales Price¡± (Continued)

E. Gross Proceeds ¨C Withdrawals for Use .....................................

Chapter 6, Page 11

F. Gross Proceeds ¨C Promotional Items Provided to Customers

For No Consideration, a Nominal Consideration, or an

Amount Significantly Below Cost .........................................

Chapter 6, Page 20

G. Gross Proceeds ¨C Withdrawals for Use in Rental Business .......

Chapter 6, Page 20

7. Chapter 7 ¨C Tangible Personal Property

A. General Guidelines .....................................................................

B. Service vs. Sale of Tangible Personal Property .........................

C. Examples of Persons Engaged in the Business of Selling

Tangible Personal Property at Retail .....................................

D. Examples of Persons Engaged in the Business of Selling a

Non-Taxable Service .............................................................

E. Sale of Tangible Personal Property vs. Improvement to

Real Property .........................................................................

Chapter 7, Page 1

Chapter 7, Page 1

Chapter 7, Page 3

Chapter 7, Page 4

Chapter 7, Page 5

8. Chapter 8 ¨C Exclusions ....................................................................

Chapter 8, Page 1

9. Chapter 9 ¨C Exemptions

A. Exemptions Authorized under the Sales and Use Tax Law

(Chapter 36 of Title 12) .........................................................

B. Other Sales and Use Tax Exemptions Authorized by the

General Assembly ..................................................................

Chapter 9, Page 1

10. Chapter 10 ¨C Maximum Tax Items

A. General Information ...................................................................

B. Boats, Boat Motors, and Boat Trailers ¨C Sold for Personal

Use .........................................................................................

C. Manufactured Homes .................................................................

D. Musical Instruments and Office Equipment Sold to

Religious Organizations .........................................................

Exhibit A ¨C Infrastructure Maintenance Fee, Sales/Use Tax, and

and Casual Excise Tax Implications of Purchases by SC

Residents, Nonresidents, and Military Personnel ..................

11. Chapter 11 ¨C Accommodations

A. General Information ...................................................................

B. Transactions Not Subject to the Sales Tax on

Accommodations ...................................................................

C. Additional Guest Charges ..........................................................

D. Hurricane Insurance ...................................................................

Chapter 9, Page 21

Chapter 10, Page 1

Chapter 10, Page 5

Chapter 10, Page 6

Chapter 10, Page 8

Chapter 10, Page 9

Chapter 11, Page 1

Chapter 11, Page 7

Chapter 11, Page 12

Chapter 11, Page 13

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