Patent Box Regime rules published

The Patent Box Regime (Deduction) Rules, 2019 were published in virtue of LN 208 of 2019. They apply to qualifying income derived from qualifying intellectual property (“qualifying IP”) on or after 1 January 2019.

The rules set out the conditions which must subsist for the application of the deduction permitted by article 14(1)(p) of the Income Tax Act, and the manner in which the percentage of qualifying income derived from qualifying IP is to be computed, by reference to the Qualifying IP Expenditure and the Total IP Expenditure and the income/gains derived from qualifying IP, clarifying the scope of each of these terms.

The rules have been drafted in a manner so as to be compliant with the OECD Modified Nexus Approach for IP Regimes, and are understood to be compliant with the relevant parameters as defined by the EU Code of Conduct Group.