ΠΕΡΙΓΡΑΦΗ

This training explores the definition of qualifying IP, computation of the nexus fraction, and the practical tax implications of holding and exploiting IP through Cyprus. Participants will understand how to structure IP ownership within global value chains, benefit from treaty protections, and comply with EU and OECD standards.

The Cyprus IP Box Regime remains one of the most competitive intellectual property tax incentives in Europe, offering effective tax rates as low as 2.5% on eligible income. However, the regime has become significantly more technical since aligning with OECD BEPS Action 5. Employers now need advisors and in-house professionals who understand not only the benefits but the strict nexus-based limitations, substance requirements, and reporting obligations.

This course is essential for tax professionals, lawyers, CFOs, and corporate administrators working with IP-heavy structures or clients in the tech, pharma, and R&D sectors. Through a practical, scenario-based format, the course addresses the treatment of R&D costs, interaction with capital allowances, and the use of Cyprus in cross-border IP licensing arrangements. Participants will also explore the compatibility of the IP regime with EU law and learn how to navigate issues such as beneficial ownership, withholding tax exemptions, and anti-abuse rules under the EU Interest & Royalties Directive.

ΣΕ ΠΟΙΟΥΣ ΑΠΕΥΘΥΝΕΤΑΙ

suitable for

• Legal professionals
• Audit professionals
• Accounting professionals
• Trustees
• Protectors (Protectorship services)

ΠΕΡΙΣΣΟΤΕΡΕΣ ΠΛΗΡΟΦΟΡΙΕΣ

Course content

Module 1: The Cyprus IP Box Regime – Framework and Compliance Issues

1.1. Overview of the Cyprus IP Box Regime introduced in 2016:

• Qualifying IP, eligible income, effective tax rate under the nexus-compliant regime.

1.2. Definition of qualifying assets and income:

• Alignment with OECD BEPS Action 5.
• Exclusion of trademarks and marketing-related IP.
• Computation of the nexus fraction.

1.3. Treatment of R&D expenses:

• Direct connection between eligible expenditures and qualifying income.
• Importance of Cyprus-incurred R&D for preferential treatment.

1.4. Interaction with capital allowances:

• Depreciation of IP assets for tax purposes.
• Treatment of capitalised development costs.

1.5. Anti-abuse considerations:

• Use of the IP regime in substance-based structures.
• Restrictions against artificial arrangements or offshoring of ownership.

1.6. EU law implications:

• Compatibility with EU State aid rules and principles of free movement.
• Review of relevant European Commission and ECJ jurisprudence.

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Module 2: Tax Treatment of Royalties and Structuring Through Cyprus

2.1. Cross-border royalty payments:

• Absence of withholding tax on outbound royalties when IP is used outside Cyprus.
• Exceptions and recent blacklist provisions.

2.2. EU Interest and Royalties Directive:

• Implementation in Cyprus.
• Anti-abuse rule for claiming benefits.

2.3. Treaty protection for royalty income:

• Analysis of typical treaty provisions (Article 12 OECD MTC).
• Limitation on source taxation.
• Beneficial ownership requirements.

2.4. Inbound royalties to Cyprus:

• Taxation under domestic rules depending on source and treaty relief.
• Role of substance and transfer pricing.

2.5. Use of Cyprus IP structures in global value chains:

• Practical examples of IP ownership, licensing, and cost-sharing through Cyprus.