Tax Implications of Buying a New Vehicle in North Carolina & Registering It in South Carolina

Tax Implications of Buying a New Vehicle in North Carolina & Registering It in South Carolina
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Purchasing a new car in North Carolina or other state across the country and transferring it to South Carolina does not usually eliminate your property tax obligations. Requiring the payment of property tax on car purchases encourages South Carolina residents to purchase vehicles within the state and reduces the instances of residents looking to other states with more-beneficial tax laws for a break.

State Property Taxes

South Carolina requires you to pay a property tax on the purchase of your vehicle from North Carolina and other states even if you paid sales tax in another state. You must take your title or current vehicle registration to your county treasurer to receive a tax bill for the amount owed on your vehicle purchase. South Carolina charges a 5 percent property tax based on your vehicle's purchase price to a maximum of $300. The county treasurer must receive this money for your registration in North Carolina to continue.

Registration and Title Fees

You must pay a variety of fees to the South Carolina Department of Motor Vehicles before the state will issue your newly purchased vehicle a South Carolina vehicle registration and license plate. At the time of publication, you must pay a $15 title fee and a varied registration fee depending on the type of vehicle you're bringing into the state. If you're over the age of 64, you also must pay a $20 to $22 additional fee. A property-carrying vehicle must pay an additional fee based on gross vehicle weight.

Tax-Exempt Vehicles

Obtaining a new vehicle under certain circumstances may exempt you from the property tax requirement. If a relative from your immediate family transfers the vehicle into your name, you do not have to pay sales tax. This is also the case if you inherit the car from a relative in another state and must register the vehicle for the first time in South Carolina. You may still have to present proof that the original owner paid any appropriate property tax on the vehicle when the vehicle was first purchased.

Failing to Pay Taxes

If you refuse to pay the property tax owed on your new vehicle purchase, the registration process cannot go forward. This means South Carolina will not issue you a state registration or state license plate. Driving without the correct registration and license plate can cause you legal problems in the event you're pulled over by the police. An expired registration can net you hefty fines and may lead to a temporary suspension of your driving privileges. You may also find difficulty in obtaining auto insurance if you cannot prove the vehicle's proper registration.