North Carolina Sales Tax on Software and Digital Products North Carolina: Sales Tax Handbook

North Carolina:

Are Software and Digital Products subject to sales tax?

While North Carolina's sales tax generally applies to most transactions, certain items have special treatment in many states when it comes to sales taxes. This page describes the taxability of software and digital products in North Carolina, including canned software - delivered on tangible media, canned software - downloaded, custom software - delivered on tangible media, custom software - downloaded, customization of canned software and digital products. To learn more, see a full list of taxable and tax-exempt items in North Carolina.


Canned Software - Delivered on Tangible Media
TAXABLE
Sales of canned software - delivered on tangible media are subject to sales tax in North Carolina.

Canned Software - Downloaded
TAXABLE
In the state of North Carolina, only computer software which meets certain descriptions is considered to be exempt.

Custom Software - Delivered on Tangible Media
EXEMPT
Sales of custom software - delivered on tangible media are exempt from the sales tax in North Carolina.

Custom Software - Downloaded
EXEMPT
Sales of custom software - downloaded are exempt from the sales tax in North Carolina.

Customization of Canned Software
TAXABLE
In the state of North Carolina, it is considered to be exempt so long as charges for modifications are separately stated.

Digital Products
TAXABLE
In the state of North Carolina, digital property is considered to be taxable.



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Source: http://www.salestaxhandbook.com/north-carolina/sales-tax-taxability/software-and-digital-products