Are Software and Digital Products subject to sales tax?
While Georgia'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 Georgia, 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 Georgia.
Canned Software - Delivered on Tangible Media
Sales of canned software - delivered on tangible media are subject to sales tax in Georgia.
Canned Software - Downloaded
In the state of Georgia, any documentation created must show the method utilized for delivery. If software is delivered both electronically and through the use of a tangible medium, the transaction will be treated as a taxable sale of some sort of tangible personal property, with the exemption of any software which would qualify as custom software.
Custom Software - Delivered on Tangible Media
Sales of custom software - delivered on tangible media are exempt from the sales tax in Georgia.
Custom Software - Downloaded
Sales of custom software - downloaded are exempt from the sales tax in Georgia.
Customization of Canned Software
In the state of Georgia, any rewritten computer software, whether it is modified to the specifications of a customer or not, is still deemed prewritten computer software. This being the case, however, so long as there is a separately stated charge on the dealer's invoice for the modification or enhancement, the charge is will not subject to tax.
Sales of digital products are exempt from the sales tax in Georgia.
Back to Georgia Sales Tax Handbook