South Carolina Use Tax Update
- Aug 25, 2015 | Gail Cole
You may not know this, but if you purchase taxable tangible goods in South Carolina and don’t pay South Carolina sales tax on the transaction, you owe South Carolina use tax.
Retailers typically collect sales tax at the point of sales and remit it to the South Carolina Department of Revenue (DOR). However, not all retailers that sell to South Carolina residents are registered as South Carolina taxpayers; for example, Amazon.com and its subsidiaries do not collect sales tax on sales shipped to South Carolina. In addition, South Carolinians may travel to other states to purchase goods that are then brought back to South Carolina for storage or use. In such situations, South Carolina sales tax isn't paid and South Carolina use tax is owed.
While use tax is hard to enforce at an individual level, businesses are required to pay use tax on their monthly sales and use tax return and audits help ensure that they do. South Carolina does allow "use tax credit ... for sales tax paid and due in another state, if the other state has similar reciprocity with South Carolina.”
Recently, the DOR updated the SC Use Tax Worksheet to facilitate reporting of use tax.
Learn more about use tax by watching this whiteboard: Consumer Use Tax Defined.