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In a recent private letter ruling, the South Carolina Department of Revenue held that software subscription services are tangible personal property subject to sales and use taxes.
Maintenance, updating, and costs for adding to a website are treated as normal business expenses and are deductible when incurred if these costs are truly maintenance-type costs.
Yes. Charges for maintenance agreements (whether optional or mandatory) that are made in conjunction with, or as part of the sale of, computer software sold and delivered by tangible means are includable in "gross proceeds of sales" or "sales price", and, therefore, subject to the tax.
The majority of states which have addressed the issue and have concluded that software (at least unbundled software) is not tangible personal property for ad valorem tax purposes and therefore is generally not taxable.
Software sold and delivered to a purchaser electronically is not subject to the sales and use tax.
South Carolina Digital products are not taxable in South Carolina. Digital products are not specifically included in the definition of tangible personal property.
If a business purchases a digital good (only digital goods, NOT digital automated services or remote access software) for business purposes, then the purchase is exempt from sales tax.
Yes. The sale of software delivered by a tangible means, the diskette, constitutes the sale of tangible personal property subject to the tax.
California: SaaS is not a taxable service. However, software or information that is delivered electronically is exempt. The ability to access software from a remote network or location is exempt. Under California sales and use tax law, there must be a transfer of TPP, in order to have a taxable event.
Prescription medicines, groceries, and gasoline are all tax-exempt. Some services in South Carolina are subject to sales tax.