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Doing business in

South Carolina

Navigate South Carolina’s business landscape with ease—whether you’re incorporating, expanding, or managing tax compliance. Commenda helps you stay ahead with automated solutions for incorporation, compliance, and tax filings.
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Business Overview

South Carolina has established strengths in manufacturing, particularly automotive and aerospace, along with tourism and agriculture. The state offers competitive business costs, customized workforce training, and significant port facilities supporting international trade.

Key Facts & Figures

Category Details
Capital Columbia
Major Cities Columbia, Charleston, North Charleston, Mount Pleasant, Rock Hill
State Sales Tax Rate 6%
Local Sales Tax Rate Up to 3% additional local taxes
Corporate Income Tax 7% flat rate
Physical Nexus Threshold Physical presence through employees, offices, or inventory
Economic Nexus Threshold $100,000 in annual sales

Did you know?

South Carolina has become a major automotive manufacturing hub, with BMW and Volvo producing vehicles in the state.

Setup & Compliance

South Carolina provides streamlined business registration with moderate regulatory requirements.

Starting a Business in South Carolina:

  1. Select Your Business Structure: Consider tax implications and liability protection needs.
  2. Register Your Business: File formation documents with the South Carolina Secretary of State.
  3. Register for Tax Accounts: Register with the Department of Revenue for sales tax and withholding.
  4. Obtain Required Licenses: Research and secure necessary state and local business licenses.
  5. Register as an Employer: Register with the Department of Employment and Workforce if hiring employees.

Key Compliance Considerations:

  • Annual Reports: Corporations must file annual reports with the Department of Revenue.
  • Annual LLC Filing Fee: LLCs pay annual filing fee to the Department of Revenue.
  • Sales Tax Collection: Collect and remit 6% state sales tax plus applicable local taxes.
  • Corporate Income Tax: Corporations pay 5% corporate income tax.
  • Professional Licensing: Various professions require specialized licenses through state boards.

Hiring & Payroll

South Carolina maintains a business-friendly employment environment with minimal state regulations.

South Carolina Payroll Requirements:

  • Unemployment Insurance: Rates from 0.06% to 5.4% on first $14,000 of wages.
  • State Income Tax Withholding: Required with progressive rates.
  • Workers’ Compensation: Required for most employers with 4+ employees.

South Carolina Employment Laws:

  • Minimum Wage: Follows federal minimum wage ($7.25/hour).
  • No state-mandated paid sick or family leave.
  • New hire reporting within 20 days.
  • Final paycheck due on next regular payday.
  • South Carolina is an at-will employment state with right-to-work laws.

State Incentives

South Carolina provides comprehensive economic incentives to attract and support business growth.

Key Business Incentives:

  • Coordinating Council for Economic Development: Offers strategic business support.
  • Jobs Tax Credit: Incentives for job creation in targeted industries.
  • Research and Development Tax Credit: Supports innovative company development.

Small Business & Startup Support:

  • South Carolina Small Business Development Center: Comprehensive business consulting.
  • Minority Business Assistance Program.
  • Rural Business Development Grants.

Regulatory Considerations

South Carolina maintains a business-friendly regulatory environment with clear guidelines.

Key Business Regulations:

  • Data Privacy: Laws protecting consumer and business information.
  • Environmental Compliance: Regulations for manufacturing and agricultural industries.
  • Professional Licensing: Required for various service-based professions.

Additional Regulatory Areas:

  • Manufacturing Sector Compliance.
  • Automotive and Technology Industry Regulations.

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