South Carolina Form ST-389 is the schedule you attach to your ST-3 Sales and Use Tax Return to report the local sales taxes you collected for counties and municipalities. You file it in the same workflow as the ST-3, calculate your net taxable sales on the worksheet, then break those sales out by jurisdiction and tax type on the reporting pages. The total flows back to Line 5 of your ST-3 as a single combined payment.
The schedule only covers general local taxes the South Carolina Department of Revenue collects on behalf of local governments. Taxes that counties or municipalities administer directly, such as local accommodations or prepared meals taxes, are not reported here.
When You Have to File the ST-389
You file the ST-389 whenever your retail location sits in a county or municipality that imposes a local sales tax, or you deliver merchandise into one. Both can apply at once if you operate in one taxing jurisdiction and ship into another.
Remote sellers are not exempt. If you have no physical presence in South Carolina but meet the state’s economic nexus standard, you need a South Carolina Retail License and remit local taxes through the same combined return as in-state retailers. Businesses with physical nexus (an office, warehouse, sales representative, or any other presence) begin collecting on the date nexus is established.
Completing the ST-389 Worksheet
The worksheet calculates the pool of sales that local tax will be applied to. Four items:
Item 1. Enter your total gross proceeds of sales, rentals, use tax, and withdrawals of inventory for your own use. This figure should match Item 3 on your ST-3 worksheet, because you are working from the same pool of gross sales.
Item 2. List each deduction that is not subject to local tax. Put the description in Column A and the dollar amount in Column B. These mirror the deductions you claim on the state return (exempt sales, sales for resale, and the like) but apply specifically to the local calculation.
Item 3. Total your Column B deductions.
Item 4. Subtract Item 3 from Item 1. The result is your net sales and purchases subject to local tax, which you will now allocate by jurisdiction.
Completing the County-by-County Reporting Pages
Pages 1 through 5 of the form are where you split that net taxable amount across every county or municipality where you made sales or deliveries. Each line is one jurisdiction and one tax type.
For every line, enter the jurisdiction’s name and its four-digit code, then complete two columns:
- Column A (Net Taxable Amount): the net taxable sales or purchases attributable to that specific county or municipality.
- Column B (Local Tax): Column A multiplied by the applicable rate, which is 1% for most local taxes.
If a single county imposes more than one local tax, say a Capital Projects Tax and a Transportation Tax, you create a separate line for each tax type in that county. One sale in that county produces two entries on the schedule.
On page 5, Line 1 totals every Column A entry across all pages, and Line 2 totals every Column B entry. The Line 2 figure is your total local tax due, and it transfers to Line 5 of your ST-3 so state and local tax are paid together.
The four-digit codes appear in the ST-389 instructions and on MyDORWAY. A wrong code doesn’t change your total liability, but it sends the money to the wrong jurisdiction and creates a correction later. If you sell or deliver into multiple counties, you need the code for each.
Local Tax Types You Will Report
South Carolina counties and municipalities can impose several distinct local taxes, each authorized by a separate statute and approved by local referendum. More than one can apply in the same county, which is why a single sale can produce multiple lines on the schedule. The categories the SCDOR lists:
- Capital Projects Tax. A 1% tax funding infrastructure such as roads, bridges, public facilities, and water and sewer projects. Counties impose it by ordinance for a specific set of projects and up to eight years. Unprepared food items eligible for USDA food coupons are exempt.
- Local Option Sales and Use Tax. A 1% tax that provides a credit against county and municipal property tax and funds local government operations.
- Education Capital Improvement Tax. A 1% tax for education-related capital projects. Unprepared food is exempt for all purchasers, not just food stamp recipients.
- School District Tax. A 1% tax earmarked for schools.
- Transportation Tax. Up to 1%, imposed for highway, road, bridge, mass transit, and other transportation projects. Unprepared food is exempt in certain counties including Horry and Jasper.
- Tourism Development Tax. Available only to municipalities in counties where state Accommodations Tax revenue reaches at least $14 million in a fiscal year.
- County Green Space Tax. Up to 1%, authorized by 2022 legislation.
- Catawba Tribal Tax. A 7% tribal sales tax within the Catawba Indian Nation’s jurisdiction.
Most of these taxes are individually capped at 1%, but because they stack, total local rates on top of the 6% state rate can reach 2% or more depending on which ordinances voters have approved. The SCDOR’s Local Sales Taxes page at dor.sc.gov lists every active local tax by category, along with the counties and municipalities where each applies and the effective or expiration dates. Ordinances expire when their funding period ends or their revenue target is hit, and new ones take effect after successful referendums, so check the page each period rather than relying on last month’s rates.
How and When You File
The ST-389 is never filed on its own. It moves with the ST-3, whether you file electronically or on paper. On MyDORWAY the system walks you through the local schedule as part of the normal return and handles the calculations, which cuts down on math errors.
Most retailers file monthly. Returns are due by the 20th of the month following the reporting period, so January sales are due February 20 and February sales are due March 20. The one exception is the November period, which is due December 2 rather than December 20. Quarterly and annual filing frequencies exist but require written approval from SCDOR.
If your South Carolina tax liability is $15,000 or more per filing period, you must file and pay electronically through MyDORWAY. Businesses below that threshold can still file on paper by attaching the completed ST-389 to the ST-3 and mailing both to the Department of Revenue. Either way, one payment covers both state and local tax.
You need a Retail License before you can collect any sales tax in South Carolina, state or local. The license costs a one-time, non-refundable $50 per location and is obtained through the Business Tax Application on MyDORWAY.
Penalties if the Schedule Is Late or Missing
South Carolina imposes separate penalties for failing to file and failing to pay, and they stack. Missing the filing deadline triggers a penalty of 5% of the tax owed for the first month, plus an additional 5% for each additional month or partial month, up to 25%. Failing to pay the tax shown on a filed return adds 0.5% of the unpaid tax per month, also capped at 25%. Interest accrues on top of both penalties at a rate tied to the federal underpayment rate under Internal Revenue Code Section 6621.
Because the ST-389 is part of the ST-3, a missing or incomplete local schedule means the entire return is incomplete. Filing the state portion correctly while neglecting the local schedule still puts you in penalty territory for the local tax amount. Filing on MyDORWAY avoids this because the system prompts you to complete the ST-389 whenever local taxes apply and will not let you submit a return that is missing a required schedule.
Records to Keep
Retain a copy of every filed ST-389 with the sales receipts, delivery records, and jurisdiction data that support your local tax calculations. South Carolina’s assessment lookback under Title 12, Chapter 54 is generally at least three years from the filing date, and longer for transactions involving unreported income. Organizing your records by county and tax type makes audits much easier: the most common issue auditors flag is mismatched jurisdiction codes, where a sale was attributed to the wrong county.