New York Tax Tribunal Rules SaaS Vendor Management System Fees Taxable for Software Licensing

• New York Tax Appeals Tribunal deemed SaaS provider’s vendor management system fees taxable
• Tribunal ruled that the fees constituted taxable licensing of prewritten software via a bundled transaction
• The software was considered the core element of the taxpayer’s business, not incidental to services provided
• Customer contracts and records showed that software technology was central element of contracts
• Customers were purchasing prewritten software to facilitate sourcing, hiring, and managing contract labor
• Ruling aimed to prevent exemption for certain sales of tangible personal property

Source: www2.deloitte.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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