‘IP Rights Box’ – Cyprus 2014
In recent years a number of EU countries have introduced schemes that can lead to substantial tax benefits in relation to license/royalty payments deriving from the exploitation of intellectual property rights. These schemes have come to be known as an intellectual property rights box (‘IP box’).
Cyprus by way of its IP box offers an effective tax rate of no more than 2.5% which is way below that offered by other jurisdictions (Luxembourg, the Netherlands, Belgium, Hungary and the United Kingdom).
Through domestic legislation and treaties, Cyprus provides for the highest standard of IP legal framework for the owners of IP rights. Cyprus has various domestic laws which regulate IP and which are to a large extend based on English law. Cyprus has ratified the Treaty and Regulations of the World Intellectual Property Organisation (WIPO) and is also a party to various International Conventions and Treaties for the protection of IP rights.
The island’s excellent infrastructure, English based legal system, and high quality of professional services combined with its well educated labour force, good industrial relations but mainly generous tax incentives create an ideal business environment. In general Cyprus offers ease of doing business in a professional environment.
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