What South Carolina tax interest rate applied in 2025, including eligible refunds after July 1?

Plain-English summary

South Carolina's listed tax interest rate was 7% throughout calendar year 2025. The rate applied to tax underpayments and overpayments under S.C. Code Ann. § 12-54-25.

Interest was generally compounded daily. Underpayments of declaration of estimated tax used simple interest.

For fiscal year 2025-2026, which began July 1, 2025, 2025 S.C. Act No. 69, Provisos 41.2 and 117.81 reduced interest paid on eligible refunds by three percentage points. That reduced the listed 7% rate to 4% for eligible refunds during July-December 2025.

The historical table shows the listed rate immediately before 2025 was 8% from October 1, 2023 through December 31, 2024.

What this means for you

Use the 7% listed rate when reviewing a 2025 underpayment. For an eligible refund in the July-December portion of fiscal year 2025-2026, apply the three-point reduction described in the letter.

Estimated-tax declaration underpayments used simple interest rather than daily compounding.

Common questions

Q: What listed rate applied during 2025?
A: 7%.

Q: What rate applied to eligible refunds from July through December 2025?
A: 4% after the three-percentage-point reduction.

Q: Was all interest compounded daily?
A: No. Underpayments of declaration of estimated tax used simple interest.

Citations and references

• S.C. Code Ann. § 12-54-25 (2014)
• S.C. Code Ann. § 12-4-320
• SC Revenue Procedure #09-3
• 2025 S.C. Act No. 69, Provisos 41.2 and 117.81

Source

• Landing page: https://dor.sc.gov/advisory-opinion-search
• Original PDF: https://dor.sc.gov/sites/dor/files/policies/IL25-16.pdf

Original ruling text

STATE OF SOUTH CAROLINA

DEPARTMENT OF REVENUE
300A Outlet Pointe Blvd., Columbia, South Carolina 29210
P.O. Box 125, Columbia, South Carolina 29214-0575

SC INFORMATION LETTER #25-16
SUBJECT:

Interest Rate

DATE:

August 25, 2025

REFERENCE:

S.C. Code Ann. Section 12-54-25 (2014)
2025 S.C. Act No. 69, Provisos 41.2 and 117.81

AUTHORITY:

S.C. Code Ann. Section 12-4-320
SC Revenue Procedure #09-3

SCOPE:

An Information Letter is a written statement issued to the public to announce general
information useful in complying with the laws administered by the Department. An
Information Letter has no precedential value.

The interest rate to be applied to underpayments and overpayments* of taxes is listed below. The rate is
compounded daily except simple interest applies to the underpayment of declaration of estimated tax.
Period

Rate*

Period

09/01/85 – 12/31/85
01/01/86 – 06/30/86
07/01/86 – 09/30/87
10/01/87 – 12/31/87
01/01/88 – 03/31/88
04/01/88 – 09/30/88
10/01/88 – 03/31/89
04/01/89 – 09/30/89
10/01/89 – 03/31/91
04/01/91 – 12/31/91
01/01/92 – 03/31/92
04/01/92 – 09/30/92
10/01/92 – 06/30/94
07/01/94 – 09/30/94
10/01/94 – 03/31/95
04/01/95 – 06/30/95
07/01/95 – 03/31/96
04/01/96 – 06/30/96
07/01/96 – 03/31/98

11%
10%
9%
10%
11%
10%
11%
12%
11%
10%
9%
8%
7%
8%
9%
10%
9%
8%
9%

04/01/98 – 12/31/98
01/01/99 – 03/31/99
04/01/99 – 03/31/00
04/01/00 – 03/31/01
04/01/01 – 06/30/01
07/01/01 – 12/31/01
01/01/02 – 12/31/02
01/01/03 – 09/30/03
10/01/03 – 03/31/04
04/01/04 – 06/30/04
07/01/04 – 09/30/04
10/01/04 – 03/31/05
04/01/05 – 09/30/05
10/01/05 – 06/30/06
07/01/06 – 12/31/07
01/01/08 – 03/31/08
04/01/08 – 06/30/08
07/01/08 – 09/30/08
10/01/08 – 12/31/08

Rate*
8%
7%
8%
9%
8%
7%
6%
5%
4%
5%
4%
5%
6%
7%
8%
7%
6%
5%
6%

Period
01/01/09 – 03/31/09
04/01/09 – 12/31/10
01/01/11 – 03/31/11
04/01/11 – 09/30/11
10/01/11 – 03/31/16
04/01/16 – 03/31/18
04/01/18 – 12/31/18
01/01/19 – 06/30/19
07/01/19 – 06/30/20
07/01/20 – 03/31/22
04/01/22 – 06/30/22
07/01/22 – 09/30/22
10/01/22 – 12/31/22
01/01/23 – 09/30/23
10/01/23 – 12/31/24
01/01/25 – 12/31/25

Rate*
5%
4%
3%
4%
3%
4%
5%
6%
5%
3%
4%
5%
6%
7%
8%
7%

*Note reduction of interest rate on refunds. For fiscal year 2025-2026 (July 1, 2025, through June 30,
2026), Budget Provisos 41.2 and 117.81 direct the Department to reduce the rate of interest paid on eligible
refunds by a total of three percentage points from the above listed rates.