The Cyprus Income Tax Law now provides generous tax exemptions related to Intellectual Property (IP). More specifically:
- 80% of any income generated from IP owned by Cypriot resident companies (net of any direct expenses) will be exempt from income tax;
- 80% of profits generated from the disposal of IP by Cypriot resident companies (net of any direct expenses) will be exempt from income tax;
- the definition of IP includes all intangible assets, including copyrights, patents and trademarks;
- any expenditure of a capital nature for the acquisition or development of IP will be claimed as a deduction in the tax year in which it was incurred and the immediate four following years on a straight-line basis.