SALT Report 2196 – The South Carolina Department of Revenue updated an information letter regarding the taxability of certain motor vehicles and trailers sold to non-residents. Code Section 12-36-930 states that sales tax is due on motor vehicles, trailers, semitrailers, and pole trailers that are sold in South Carolina and will be registered and licensed in the non-resident’s state. The sales tax due is the lesser of:
The sales tax that would be imposed in the purchaser’s state of residence, or
The tax that would be imposed in South Carolina
However, no sales tax will be due in South Carolina if the non-resident will not receive a credit in their state for sales taxes paid to South Carolina.
At the time of the sale, the seller must obtain from the purchaser a notarized statement detailing the purchaser’s intent to license the vehicle in the purchaser’s state of residence within 10 days using South Carolina Form ST-385. The purchaser must provide a completed and notarized copy of Form ST-385 to the taxing agency in their state of residence.
The information letter also discusses sales tax rates imposed by neighboring states, sales to residents of other countries, sales not subject to sales and use tax, and the $300 maximum sales tax.
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