A company’s charges for software as a service (SaaS) are not subject to New Jersey sales and use tax as long as the software is only accessed by the user and there is no transfer or delivery of the software to the user. The company provides software as a service, where a user pays a monthly fee for use of a web application hosted on the company’s computer systems. The company has created a tool that enables users to create puzzles. The user provides input for the puzzles, and the company’s service transforms this input into puzzles on the company’s servers. The company then provides the puzzles to the user as a downloadable PDF file. Web-hosted services where software is only accessed by the user and not delivered or transferred to the user, are not subject to New Jersey sales or use tax. (LR: 2012-4-SUT, New Jersey Division of Taxation, June 22, 2012)