Vermont – Refunds for Taxes Paid on Prewritten Software

SALT Report 1584 – Due to recently passed legislation in Vermont, the state is now offering a sales tax refund for taxes paid on sales of remotely accessed prewritten software, sometimes called cloud computing or software as a service.  In addition to the refund, the state is providing a temporary moratorium on sales tax for purchases of prewritten software until June 30, 2013.
Qualified Charges
Refunds will be provided for taxes paid on software that allows a user to access and use prewritten software that is not owned, managed, or controlled by the consumer or a related company.
What Does Not Qualify?
Software purchased by download and purchases of specified digital products that are listed in 32 V.S.A. § 9771(8) and the following materials do not qualify for the refund:
  • Digital audio visual works
  • Digital audio works
  • Digital books
  • Ringtones

Covered Periods

The Department will not assess tax on sales of remotely accessed prewritten software made between December 31, 2006 and July 1, 2013. In addition, tax paid on these purchases will be refunded if the refund request is made within three years of the date the tax was paid.

How to Apply for a Refund

Anyone interested in a refund must submit an Application for Refund, Form SMWA-1 along with the following documentation:

  • An invoice or license to use the product,
  • A product description,
  • Vendor name,
  • Date of purchase,
  • Amount of purchase, and
  • Amount of tax paid

For Further Information:

Vermont – Information Sheet