One of our hosted customers wants to upgrade some Windows XP machines to Windows 7. I can see that with the Volume Licensing Service Center gives me access to Windows 7 or 8 DVD images but how do I sell these licences under spla to our customer?

Please note that Microsoft do not allow Windows Desktop OS to be hosted in a shared hardware environment. 

You may use the Windows Desktop Upgrade licenses only in a “managed-pc” solution – i.e. you have signed a Rental Addendum under SPLA & are renting out your pc/laptop to the customers.

In a “managed-pc” solution, you may use the Windows Desktop upgrade license from VLSC and report the Windows Pro Upgrade SKU under SPLA.