Withholding Tax is money withheld from an individual’s wages and sent to the South Carolina Department of Revenue (SCDOR) on the employee’s behalf. This withholding is used as a credit against the employee’s total yearly Income Tax liability.

Every employer who has an employee earning wages in South Carolina must make a return or deposit to the SCDOR for any taxes that have been withheld for state purposes.

Register for Withholding by completing the Business Tax Application with the South Carolina Department of Revenue on MyDORWAY. 

BOS TIPS:

  • If the employee is working in South Carolina, regardless of where he/she is a resident, the income earned in South Carolina is taxed by South Carolina.
  • If a South Carolina resident is earning wages in a state that does not have a state income tax, the withholding should be for South Carolina.

Learn more about making withholding payments from this video from the SCDOR.

Find more information about South Carolina Withholding Tax.

 

Withholding Tax FAQs

Businesses report their Withholding quarterly using the following forms:

  • WH-1605 for quarters 1, 2, and 3
  • WH-1606 for the 4th quarter/annual return

The easiest and most secure way to register for a Withholding account, make Withholding payments, and file Withholding returns is on the South Carolina Department of Revenue electronic portal called MyDORWAY.

Employers are highly encouraged to file and pay electronically on MyDORWAY, and you are mandated to do so if:

  • You withhold $15,000 or more in a quarter
  • You make 24 or more payments in a calendar year

Learn more about MyDORWAY.

Businesses that issue W-2s reporting South Carolina wages or South Carolina Withholding must submit the W-2s directly to the South Carolina Department of Revenue (SCDOR).