(a) There is exempt from the tax imposed by this chapter the use of computer software that is developed and fabricated by an affiliated company, regardless of whether such software is accessed and used as described in § 67-6-231(b) or delivered by other means.

Terms Used In Tennessee Code 67-6-395

  • Computer: means an electronic device that accepts information in digital or similar form and manipulates it for a result based on a sequence of instructions. See Tennessee Code 67-6-102
  • Computer software: means a set of coded instructions designed to cause a computer or automatic data processing equipment to perform a task. See Tennessee Code 67-6-102
  • Software: means computer software. See Tennessee Code 67-6-102
  • Use: means and includes the exercise of any right or power over tangible personal property incident to the ownership thereof, except that it does not include the sale at retail of that property in the regular course of business. See Tennessee Code 67-6-102
(b) There is exempt from the tax imposed by this chapter the repair of computer software or any other services otherwise taxable that are rendered by a company for an affiliated company.
(c) For purposes of this section, companies are affiliated only if:

(1) Either company directly owns or controls one hundred percent (100%) of the ownership interest of the other company; or
(2) One hundred percent (100%) of the ownership interest of both companies is owned or controlled by a common parent.
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