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.

Data Survey Services Not Taxable in South Carolina

Monday, June 24th, 2019 -The South Carolina Department of Revenue recently ruled that business data survey services were non-taxable pr...

Senior Center Cafeterias are Taxable in Missouri

Friday, June 21st, 2019 -Missouri's Director of Revenue recently issued a letter ruling taxing the sale of cafeteria food by a 501(c)(3...

Hot-Air Balloon Rides in Missouri are Taxable When...

Wednesday, June 19th, 2019 -Missouri recently released a letter ruling addressing the taxation of hot-air balloon rides. The taxpayer was ...

Nevada Exempts Certain Medical Equipment

Monday, June 17th, 2019 -Effective July 1, 2019, Nevada will exempt durable medical equipment, oxygen delivery equipment, and mobility ...

Participatory Sports are Taxable in New York

Friday, June 14th, 2019 -The New York Division of Tax Appeals recently denied a refund claim made by an instructor-led indoor spin clas...

Marketplace Facilitators to Collect Tax in Vermont

Thursday, June 13th, 2019 -Vermont recently passed a bill requiring marketplace facilitators to collect and remit sales tax on retail sal...