IP Tax Planning & IP Box
New tax measures are continuously being considered by governments around the world with attention to Intellectual Property (IP) tax. This has inevitably resulted in companies considering IP tax planning by migrating IP from one tax jurisdiction to other lower tax jurisdictions.
The Cyprus Intellectual Property (IP) tax, commonly known as the Cyprus IP Box regime, is a tax incentive that aims to encourage research and development activities and enhance Cyprus' attractiveness as an international IP management and development hub.
The Cyprus Intellectual Property (IP) Box Tax Regime
Taking advantage of the Cyprus "IP Box" Tax Regime, Cyprus offers the lowest tax regime on IP rights in Europe (maximum 2%) while protected by EU regulations on IP and by the fact of Cyprus being a member of all major international IP treaties and protocols.
The Cyprus IP Box is a tax regime designed to promote innovation and intellectual property development within the country. It allows companies that hold qualifying intellectual property rights to benefit from an effective tax rate as low as 2.5% on income generated from these rights. This is far below the standard corporate tax rate in Cyprus. Qualifying IP rights include patents, copyrighted software, and other IP assets related to research and development activities.
To enjoy the benefits, the company needs to have undertaken the research and development activities leading to the creation of the IP, directly or through subcontracting. Further, it should be managing the qualifying IPs and bearing the respective risks.
This regime is intended to incentivize companies to innovate and create new intellectual property, while also making Cyprus an attractive destination for businesses operating in the tech and creative sectors.
Transferring IP and Structuring: We further advise you on the manner and methods of transferring IP, being intangible property, to a structure which will have a substantial impact on the tax results of your company while at the same time you ensure that all substantial rights are successfully being transferred for tax purposes, achieving, therefore, the end result.
For more details as to how can we help you, please contact us now.
Legal500 EMEA 2023 Edition
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"They have gained a strong reputation in tax in Cyprus and I believe there is no other law firm in Cyprus with a truly dedicated tax practice as AGPLAW has. The differentiative factor from competitors in Cyprus is that AGPLAW consists of a true tax team, specialists on tax and focusing on expanding this practice further.".
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