Licence agreement
A licence agreement grants the right to use software, for a term or perpetually. Perpetual licences often come with a separate annual support fee that renews.
Commitment: Carries the money and the dates. The only role counted in spend.
Key takeaways
- Record whether the licence is perpetual or for a term.
- Track annual support and maintenance as its own renewing commitment.
- Note any restrictions on transferring or reducing licences.
What renews on a perpetual licence?
The licence itself does not, but support and maintenance usually renews every year, often with an uplift.
What to record
- Perpetual or term
- Support fee and renewal
- Licence count
Frequently asked questions
How does a perpetual licence show in spend?
The one-off fee falls in the year it was paid. The support fee is the recurring commitment.
General working knowledge about commercial contracts, not legal advice. Your own agreement governs.