Intellectual Property (IP) regime
The real competitive advantage
Intellectual Property (IP) can be one of the most valuable assets of an organization. Therefore, choosing the appropriate regime/location for structuring the exploitation of IP assets is vital for an organization in order to achieve efficient business development, effective IP protection and maximization of tax saving.
On 14 October 2016, The House of Representatives approved amendments to the Income Tax Law which results the Cypriot legislation on the taxation of the income from the exploitation or sale of intangible assets (IP), be in line with the recommendations of the Organization for Economic Co-operation and Development (OECD) Action 5 of the Base Erosion and Profit Shifting (BEPS). This is based on a “modified nexus approach”. A taxpayer can benefit from the provisions of a particular IP tax regime if IP income is generated through incurred Research and Development (R&D) expenditures. The Cypriot IP regime could be called as the most beneficial IP regime in Europe.