
Malta IP Box Regime
95% deduction yields effective 1.75% rate when nexus ratio is 1
Indefinite · Foreign income partly exempt
Cyprus's IP Box regime offers an effective tax rate of just 2.5% on qualifying IP income by providing an 80% deduction on profits from patents, software, and other registered intellectual property.

Regime overview
Tax regimes comparison
| Tax Type | Default | IP Box Regime | Non-Dom Regime |
|---|---|---|---|
| Eligibility | Any resident | Residency | Residency |
| Duration | Indefinite | Indefinite | 17 years |
| Income Tax | 0-35% | N/A | 0-35% |
| Foreign Income | Taxed | Partially exempt | Exempt |
| Capital Gains | 20% | 0% | 0% |
| Dividends | 0-5% SDC | N/A | 0% |
| Wealth Tax | None | None | None |
| Inheritance Tax | None | None | None |
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Key benefits
Migration pathways
EU/EEA/Swiss Citizens
Residency Visas
Program details
Cyprus's IP Box regime provides one of the most attractive intellectual property tax incentives in Europe. The regime offers an 80% deemed deduction on qualifying profits derived from qualifying intellectual property assets, resulting in an effective corporate tax rate of just 2.5% (versus the standard 12.5% corporate rate).
Qualifying IP assets include patents, patented inventions, computer software, and other IP assets certified by a competent authority as novel, non-obvious, and useful. Copyrights and trademarks do not qualify.
The regime follows OECD-compliant "nexus" principles, meaning the benefits are tied to actual R&D activities conducted by the taxpayer. The more R&D conducted in-house or in Cyprus, the greater the benefit.
While primarily a corporate tax benefit, individual IP owners operating through Cyprus entities can benefit from this combined with the Non-Dom regime for dividend exemptions.
Interested in IP Box Regime?
Our tax advisors can help you evaluate eligibility requirements and optimize your tax position under this regime.
Schedule consultationOther tax regimes

95% deduction yields effective 1.75% rate when nexus ratio is 1
Indefinite · Foreign income partly exempt

50% exemption roughly halves corporate tax on qualifying IP income
Indefinite · Foreign income partly exempt

Qualifying patent profits taxed at effective 10% corporation tax
Indefinite · Worldwide taxation

A reduced 7% corporate income tax rate can apply to taxable profits from the commercial exploitation of qualifying IP, materially below Lithuania's standard CIT rate
Indefinite · Worldwide taxation
Personal income tax rates
PwC Tax Summaries - Cyprus Individual Taxes on Personal Income·Last checked: 12/01/26
Personal income tax rates (government)
Cyprus Tax Department - Income Tax·Last checked: 12/01/26
Capital gains tax (20% rate, immovable property scope)
Cyprus Ministry of Finance - Tax Department, Capital Gains Tax·Last checked: 14/01/26
Capital gains tax
Cyprus Tax Department - Capital Gains·Last checked: 12/01/26
Dividend taxation (Special Defence Contribution)
Cyprus Tax Department - Special Defence Contribution·Last checked: 12/01/26
Wealth tax
PwC Tax Summaries - Cyprus Individual Other Taxes·Last checked: 12/01/26
Inheritance/estate tax
Cyprus Tax Department - Deceased Person's Estate Tax·Last checked: 12/01/26
Foreign income treatment (Non-domicile regime)
Cyprus Tax Department - Individuals·Last checked: 12/01/26
Expert guidance
Our advisors help you evaluate tax regimes, understand eligibility, and structure your move for maximum tax efficiency.
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