South Carolina Issues Guidance For Kayaking And Paddleboard Businesses

Monday, February 9th, 2015

 
 
A paddleboard on a lake.
Share
Link
South Carolina
Services

The South Carolina Department of Revenue ("Department") issued guidance on how tax applies to the kayak and paddleboarding business.

South Carolina taxes retail sales of tangible personal property. "Retail sales" include (1) all sales of tangible personal property except wholesale sales and (2) the withdrawal, use, or consumption of tangible personal property by anyone who purchased the property wholesale. "Withdrawal" means the property is taken from the business stock and used in connection with the business. Retail sales do not include purchases for resale. South Carolina also taxes the use of tangible personal property that is stored, used, or consumed in South Carolina.

Kayaking and paddleboarding businesses generally conduct business in one of three ways. They may (1) rent property, but not provide tours; (2) provide tours, but not rent property; or (3) rent property and provide tours. Sales and use tax apply differently in each situation.

Businesses that rent kayaks and paddleboards, but do not conduct tours, must collect sales tax on the rental charges. Purchases of kayaks and paddleboards to rent to customers are non-taxable purchases for resale. The business must provide a resale certificate at the time of purchase.

Businesses that conduct tours using kayaks and paddleboards, but do not rent them, do not collect sales tax on the service charge. The tour service is not taxable. The kayaks and paddleboards purchased to provide tours are subject to sales tax at the time of purchase.

Businesses that provide tours and rent kayaks or paddleboards must either (1) pay tax when they purchase these items or (2) pay tax on each withdrawal of these items. When the business uses the kayaks or paddleboards to conduct a tour, it "withdraws" these items from its inventory. These withdrawals are taxable if the business purchased these items for resale. If the business paid tax at the time of purchase, the withdrawals are not taxable. If the company pays tax on each withdrawal, tax is due at the time of each use. The charge for the tour service is still not taxable.

http://www.dor.sc.gov/policy/rr15-1-doc


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.

Louisiana Sales Tax Rates and Exemptions Set to Change...

Friday, May 25th, 2018 -Louisiana's sales tax rates and exemptions are set to change July 1, 2018, when several 2016 law changes will ...

Florida Exempts Generators Used in Assisted Living...

Thursday, May 24th, 2018 -Florida recently adopted an emergency rule on exempt sales of emergency generators for use at nursing homes an...

Washington Penalty Reduction Program

Monday, May 21st, 2018 -Businesses that apply to register with Washington's Marketplace Fairness Penalty Reduction Program by June 30,...

Fuel Used to Heat Detached Garages Taxable in Maine

Monday, May 21st, 2018 -Maine Revenue Services recently released a publication explaining that sales tax applies to fuel that is used ...

Cloud Software No Longer Taxable in Indiana

Thursday, May 17th, 2018 -Effective July 1, 2018, cloud software will no longer be taxable in Indiana. Indiana taxes the sale, lease,...

Sales Tax Increase in the Historic Triangle Region of...

Monday, May 14th, 2018 -Effective July 1, 2018, there will be an additional one percent (1%) regional sales and use tax imposed in the...