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April 7, 2022
If you’ve ever purchased a new or used car, you know that there are always hidden fees and taxes associated with the purchase. But you may not know just how much additional cash you need to shell out.
To help you get an estimate for what additional taxes and fees you’ll need to pay on your new vehicle in South Carolina, check out this easy guide.
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Instead of paying a sales tax, South Carolina residents must pay an Infrastructure Maintenance Fee (IMF). This fee is 5% of the sale price but will never exceed $500.
In other words, if the price of the car was less than $9,999, then you owe 5% of that to the state, but if the price is over $10,000, then you owe $500 for the IMF.
You will not be able to title or register your vehicle until you pay this fee.
Calculating your state sales tax on your new car in South Carolina is easy. Just follow this simple formula to find how much you will need to pay in sales tax and how much you’ll need to pay in total for that new vehicle.
If your car costs you less than $9,999, multiply the cost of the vehicle by 5% (or .05) to get the IMF.
For example, if your new car costs $8,000, and you trade-in your car for $2,000, you will multiply $6,000 by 5% to get $300.
If your vehicle cost over $10,000, the IMF is $500 (maximum amount).
Calculate Car Sales Tax in South Carolina Example:
- Sale Price 1: $8,000
- Sale Price 2: $15,000
- Trade-in Amount: $2,000
- Incentives: $1,000
IMF for Sale Price 1: ($8,000 - $2,000) * .05 = $300
IMF for Sale Price 2: ($15,000 - $2,000) = $13,000 is over $10,000, so $500
Yes, any vehicles, including used cars, purchased or leased after July 1, 2017, must pay the 5% or $500 IMF.
Beaufort, Berkeley, Charleston, Hampton, Horry, and Jasper Counties have the highest sales tax rate of 9%, which includes an additional 4% in local taxes.
Oconee and Pickens County have the lowest overall tax rate of 7%.
However, for car purchases, there is a flat 5% Infrastructure Maintenance Fee (price is under $9,999), or a $500 fee (price is over $10,000).
The value of your trade-in vehicle in South Carolina is not subject to tax and is instead credited toward your new vehicle purchase. In other words, be sure to subtract the trade-in amount from the price before calculating the IMF.
If you purchase a new vehicle for $13,000 and trade in your vehicle valued at $5,000, your total taxable amount would be $8,000. The IMF comes out to $400.
However, if your trade-in was for $2,000, the taxable amount is $11,000. Since the amount is over $10,000, the IMF is $500.
Private car sales in South Carolina are taxed the same way as new and used cars.
However, instead of calculating from the sale price, you must pay 5% of the fair market value (but cannot exceed $500).
Rebates and dealer incentives are taxable in the state of South Carolina. In other words, do not subtract any incentive amount from the car price before calculating the IMF.
As an example, let's say you want to purchase a new truck for $25,000, and the dealer provides a $5,000 rebate. You still have to pay taxes on the full $25,000 sale price.
Aside from the state tax on your new or pre-owned vehicle, some other fees and taxes need to be factored into the final price.
The DMV and state fees that could be associated with the purchase of a new vehicle in South Carolina include:
Dealership fees are also known as closing fees, “doc” (document), administrative, or processing fees. These are additional costs that dealerships charge for the paperwork-related tasks associated with selling vehicles to consumers.
In the state of South Carolina, dealerships must provide written notice to the Department of the maximum dealership fees they intend to charge by January 31st of each year.
If a dealership intends to charge over $225 in closing fees, the state can review the intended fees, so those purchasing a vehicle in South Carolina have a bit of protection from dealerships charging exorbitant fees.
There are just a few reasons how you could get out of paying sales tax on your vehicle in South Carolina, including:
To show support for folks purchasing “greener” vehicles, South Carolina offers tax credits to anyone purchasing an electric or hybrid plug-in vehicle.
This federal tax credit could be up to $7,500, depending on eligibility.
Tax information and rates are subject to change, please be sure to verify with your local DMV.
South Carolina residents must pay a 5% Infrastructure Maintenance Fee, instead of a sales tax. The maximum amount you can owe is $500.
Yes, you will have to pay the 5% IMF if the vehicle was under $9,999 or $500 if the vehicle was over $10,000.
You do not have to pay sales tax on a gifted car in South Carolina.
Registration is $40 in South Carolina. However, electric car owners have to pay $120, and hybrid car owners must pay $60 for registration.
A trade-in in South Carolina reduces the total taxable amount of your new vehicle causing your sales tax to be reduced.
You can avoid paying sales tax on a vehicle in South Carolina by having a car gifted to you.
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