South Carolina Taxes Cloud-Based Telephone Services

Monday, December 1st, 2014

 
 
Two cell phone towers.
Share
Link
South Carolina
Telecom

The South Carolina Department of Revenue recently released a private letter ruling discussing the taxability of cloud-based telephone services.

The taxpayer sold cloud-based telephone services to companies located in South Carolina. For these services, the taxpayer remotely processed and routed telephone calls through its customers' telephone systems. The taxpayer also provided audio and video conferencing, web conferencing, and mobile services. The taxpayer bought, stored, used, and maintained all the hardware and software used to provide services.

South Carolina taxes the sale of tangible personal property. "Tangible personal property" includes services and intangibles, including communications services. "Communications" is the means for the transmission of the voice or of messages. Communications services are taxed on the gross proceeds received from voice or message transmission.

The taxpayer was providing a taxable communications service. The definition of "communications" requires that taxpayer's hardware and software send information. Although the taxpayer did not transmit voice or messages through outside telecommunications services, the taxpayer did route that information within the customers' telephone systems. The taxpayer sent information, so the taxpayer provided a taxable communications service.

http://www.sctax.org/NR/rdonlyres/ED4F5B54-CED6-4139-BCF8-FFFF9BDDF0B2/0/PLR144San.pdf


About TTR

Transaction (buying or selling things), Tax (the tax on this activity), Resources (our people, our website, our support services) - TTR, Inc.

TTR has a website that companies subscribe to and use daily. This website provides a list of everything that can be bought or sold in the U.S. It provides simple answers to whether buying or selling these items is taxable (subject to a sales tax or other tax), and it provides all the legal authority to support these tax answers.

TTR likes to keep things simple and fun, which is why it has great people who provide help to clients on any support questions they have about transaction tax issues.

Please visit TTR on the web at www.ttrus.com or call 866.578.8193.

Marketplace Facilitators of Software Products to be...

Friday, March 15th, 2019 -The Commissioner of Taxation and Finance in New York released an advisory opinion that determined third partie...

Arkansas Rules on Taxability of Repairs and Labor Related...

Wednesday, March 13th, 2019 -The Arkansas Department of Finance and Administration recently released an administrative decision addressing ...

Studio Room Rental for Photography Sessions is Subject to...

Wednesday, March 6th, 2019 -The Missouri Department of Revenue (DOR) has released a letter ruling addressing the taxability of studio room...

Unprocessed Sand Not Taxable in Texas

Monday, March 4th, 2019 -The Texas Comptroller recently released a private letter ruling that found the mining and selling of unprocess...

California to Require Additional Registration and...

Friday, March 1st, 2019 -California recently released a special notice for out-of-state retailers who are required to register with the...

Guided Hunting and Fishing Trips are Taxable in Washington

Wednesday, February 27th, 2019 -The Washington Department of Revenue recently published guidance stating that guided hunting and fishing trips...