When is computer software subject to the sales tax in Tennessee?

Prewritten and custom computer software is taxable in Tennessee if it is:

  • provided to the customer in Tennessee on tangible storage medium (e.g., disks and tapes);
  • provided to the customer by loading and leaving on the customer’s (or the customer’s designee’s) computer in Tennessee;
  • provided to the customer by electronically delivery (e.g., download) to the customer’s computer in Tennessee;
  • provided to the customer by programming in the customer’s (or the customer’s designee’s) computer in Tennessee; or
  • as of July 1, 2015, remotely accessed by the customer from a location(s) in Tennessee (remotely accessed software means software that remains in the possession of the seller but is made available to the customer for the customer’s use from a remote location.  See Important Notice #15-14 for more information).
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