New provisions apply from 1 July 2016 relating the IP box regime. The new law is applicable for intellectual property assets developed after 1 July 2016. Specifically qualified assets are those intellectual property assets acquired, developed or exploited by a person in furtherance of his business, (excluding intellectual property associated with marketing) and which are the result of research and development activities and include assets that have no legal registered ownership but only economic ownership. These assets are patents, computer software and other IP assets.
For the other IP assets (non obvious, useful and unique) to be qualifying, the person which utilizes them in furtherance of a business cannot generate annual gross revenues exceeding Euro 7.5m. Business names (including brands), trademarks, image rights and other intellectual property rights used to market products and services are not considered as qualifying intangible assets.
As in the previous regime, 80% of the overall profit arising from qualified intangible assets may be claimed as deemed deductible expense thus reducing the overall effective tax rate for such companies. Transitional rules exist for IPs entered into the previous regime before 30 June 2016.
Athos Kakofengitis BSc (Hons), Econ., FCA
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