What to Budget for Car Taxes and Registration Fees in South Carolina

How car taxes and fees work in South Carolina

South Carolina charges you a one-time sales tax when you buy a car, then an annual registration fee based on the vehicle's age and weight. The sales tax is 5 percent of the purchase price, though some counties add a local option tax of up to 2.5 percent on top of that. The registration fee starts at $30 for a new vehicle and decreases each year until the car is seven years old, after which it stays at $30 annually.

Unlike some states, South Carolina does not charge a property tax on vehicles. You will pay sales tax once at purchase, then registration fees every year you own the car. Both amounts depend on where you buy the car and what you buy, not on your income or how much you drive.

If you are buying from a private seller instead of a dealer, you still owe sales tax on the purchase price. You pay it when you register the vehicle with the Department of Motor Vehicles, not at the time of sale.

Key Takeaways

• South Carolina sales tax on a car purchase is 5 percent statewide, plus up to 2.5 percent local tax depending on your county.
• Registration fees run $30 per year for vehicles seven years old or newer, and decrease by roughly $4 to $5 per year for newer cars.
• You pay sales tax once when you buy the car, then registration fees every year you own it.
• The county where you register the vehicle determines your local tax rate, not the county where you buy it.
• Private-party sales are taxed the same way as dealer sales — you pay the tax when you register the car with the DMV.

Calculating sales tax on your purchase

Start with the actual purchase price of the vehicle. If you are buying from a dealer, this is the negotiated price before any add-ons or dealer fees. If you are buying from a private seller, it is the price you agree to pay.

Multiply that price by 0.05 to find the state sales tax. Then add your county's local option tax rate. You can find your county's rate on the South Carolina Department of Revenue website by searching for "local option sales tax by county," or call your county assessor's office. Most counties charge between 0 and 2.5 percent, though a few charge nothing extra.

Example: You buy a car for $15,000 in Richland County, which has a 2 percent local option tax. State tax is $15,000 × 0.05 = $750. Local tax is $15,000 × 0.02 = $300. Total tax is $1,050.

If you are trading in a vehicle, South Carolina allows you to subtract the trade-in value from the purchase price before calculating tax. So if you buy a $15,000 car and trade in a vehicle worth $5,000, you pay tax only on $10,000.

Understanding annual registration fees

Registration fees in South Carolina depend on the vehicle's age and weight. A new car (model year 2018 or newer) costs $30 per year to register. Each year the car gets older, the fee decreases slightly until it reaches $30 again at seven years old, where it stays for the life of the vehicle.

The exact fee schedule is set by the state and changes slightly year to year, but the pattern is consistent: newer cars cost more to register, older cars cost less, and cars seven years and older cost the minimum. You can find the current fee schedule on the South Carolina DMV website under "Vehicle Registration Fees."

Weight also affects the fee, but only for commercial vehicles and trucks over a certain weight. For standard passenger cars and light trucks, age is the only factor that matters.

What happens when you buy from a dealer versus a private seller

When you buy from a dealer, the dealer usually handles the registration paperwork and collects the sales tax at the time of sale. You will see the tax listed on your bill of sale or purchase agreement. The dealer then sends the tax to the state on your behalf.

When you buy from a private seller, you handle the registration yourself. You bring the bill of sale, the signed title, and proof of insurance to your local DMV office. You pay both the sales tax and the registration fee at that time. The DMV will not register the vehicle until you pay the tax.

In both cases, the amount of tax you owe is the same. The only difference is who collects it and when.

Budgeting for the total cost of ownership

When you are deciding whether you can afford a car, add the sales tax and first year's registration fee to the purchase price. For a $15,000 car in a county with 2 percent local tax, that is $15,000 + $1,050 (tax) + $30 (registration) = $16,080 out of pocket in year one.

In year two and beyond, you will pay only the registration fee, which will be slightly less than $30 if the car is still relatively new. Once the car is seven years old, the registration fee stays at $30 per year.

Do not forget to budget for insurance, maintenance, fuel, and repairs on top of these taxes and fees. Insurance is often the largest ongoing cost after fuel, and it varies widely based on the car's value, your driving record, and your age.

What to do if you move to a different county

If you move to a different South Carolina county after registering your car, you do not owe sales tax again. Sales tax is paid once at purchase, based on the county where you register the vehicle at that time.

When you renew your registration in your new county, you will pay the annual registration fee, which is the same statewide. Your new county's local tax rate does not apply retroactively to a car you already own.

Frequently Asked Questions

Do I have to pay sales tax if I buy a car out of state?

If you buy a car out of state and bring it to South Carolina, you owe South Carolina sales tax when you register it here. You will not get a credit for any tax you paid in the other state. Register the vehicle in South Carolina within 30 days of purchase to avoid penalties.

What if I buy a car from a family member?

You still owe sales tax on the fair market value of the car, even if you paid less or nothing. The DMV uses the vehicle's book value if the price seems unusually low. Bring a bill of sale showing the actual amount paid, and be prepared to explain any large difference from the book value.

Are there any exemptions from sales tax on cars?

South Carolina does not offer a general sales tax exemption for vehicle purchases. Some nonprofits and government agencies may may have access to for exemptions, but individual buyers do not. If you are buying on behalf of an organization, contact the South Carolina Department of Revenue to ask about your specific situation.

Can I deduct car taxes on my state income tax return?

South Carolina does not allow you to deduct sales tax paid on a vehicle purchase. However, if you use the car for business purposes, you may be able to deduct depreciation or mileage. Talk to a tax professional about your specific situation.

What if I buy a car and sell it within a year?

You do not get a refund of the sales tax you paid. The tax is due at the time of purchase and is not refundable if you later sell the car. When someone else buys your car from you, they will owe sales tax on their purchase price.