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Aaron Giles - Georgia Sales Tax Exemption For Software

Since most businesses utilize software in their operations, it is important for tax and accounting professionals to recognize how the Georgia sales tax exemption for software impacts their business. GA Comp. R. & Regs. 560-12-2-.111(3)(b) provides a sales tax exemption on the sale, lease, rental, license or use of custom computer software. Custom computer software is defined as, “computer software, including custom updates, which is designed and developed by the author to the specifications of a specific purchaser” per GA Comp. R. & Regs. 560-12-2-.111(2)(e) This Georgia sales tax exemption for custom computer software will apply regardless of how the purchase obtains the software. A purchaser can receive the custom computer software through a tangible medium and it will not affect the taxability of the software since the tangible medium is considered incidental to the sale.

The real essence of the transaction with custom computer software is the professional service provided by the seller in the creation and development of the custom software program. If a software program that is developed to the specifications of a specific purchaser is then distributed for widespread use to different purchasers, the software ceases to be considered custom and would become subject to sales tax as prewritten computer software. However, the original purchaser can obtain multiple copies or license agreements of the custom software that was developed to their specifications and this would meet the criteria for the sales tax exemption.
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Written by Aaron Giles | Posted in Georgia Sales And Use Tax • Sales Tax Exemption

Delaware Sales And Use Tax

The State of Delaware is one of the five States In the in the United States that does not have a Sales And Use Tax.

Florida Sales And Use Tax

The state of Florida levies a 6% state sales tax rate on the retail sale, lease or rental of most goods. Counties impose their own additional surtaxes. The range of sales tax rates charged within the state of Florida is between 6% and 7.5%. Florida’s county surtax rates are capped on purchases over $5,000, which is different from other states. For example, if you purchased a motor vehicle with the purchase price of $20,000 in a county with a 1% surtax rate, 7% tax would be due on the first $5,000 of the purchase price and 6% tax would be due on the remaining $15,000 of the purchase price.

Use tax is due on all purchases brought into the state of Florida, unless specifically exempted. Use tax is due at the same rates as sales tax. Returns are to be filed on or before the 20th day of the month following the month in which the purchases were made. For example, purchases made in the month of July should be reported to the state of Florida on or before August 20th.

Written by Aaron Giles | Posted in Delaware Sales And Use Tax • Florida Sales And Use Tax • Georgia Sales And Use Tax • Hawaii Sales And Use Tax