For Immediate Release
April 9, 2012

Utah – Provision Enacted On Computer Software Maintenance Contracts

Utah – Provision Enacted On Computer Software Maintenance Contracts

Utah – Provision Enacted On Computer Software Maintenance Contracts

Creates allowed percentages for bundled transactions.

The purchase of an optional computer software maintenance contract that consists of taxable and nontaxable products that are not separately itemized on an invoice or similar billing document is a bundled transaction that is 40% taxable and 60% nontaxable.

A “computer software maintenance contract” is a contract that obligates a seller of computer software to provide a customer with (1) future updates or upgrades to computer software, (2) support services with respect to computer software, or (3) a combination of both.

An “optional computer software maintenance contract” is a computer software maintenance contract that a customer is not obligated to purchase as a condition to the retail sale of the computer software.

If you would like additional information on this topic or have any questions, please contact the taxdesk@thesaltgroup.com

 

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