Cyprus IP Box Regime

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.