In the case of businesses earning income on intellectual property rights (IP) created as a result of research and development activities, it is worth taking care of an appropriate VAT rate. To this end, entrepreneurs can utilise the IP BOX relief.
It is an extremely beneficial form of taxation for entrepreneurs carrying out research and development activities, not only due to tax savings. In addition, the value of the tax paid can be optimised through the use of another mechanism, namely the Research & Development relief, which provides the possibility of double deduction of costs incurred directly for development activities and scientific research.
The beneficiaries of the IP BOX relief are obliged, among other things, to keep detailed records of economic events. At MDDP Outsourcing, we understand that for those using the relief, it is important to keep documentation in line with the requirements of the relief. Therefore, our comprehensive services for entities using the IP BOX include maintaining the required detailed records of economic events. This is facilitated by our IT solutions, in particular thanks to the electronic document workflow system, where you can allocate costs per IP in a clear and accurate way and, at the same time, classify them according to other criteria, e.g. by projects, phases, etc.
In addition, you can rely on the professional service of verifying whether your accounting for the IP Box or R&D relief is correct.
As part of comprehensive support for IP BOX beneficiaries, we also offer the following services:
The MDDP Outsourcing team from Katowice and Warsaw provides professional services in the process of determining the eligibility for, and then the implementation of, the IP BOX relief. The services we offer will help you apply for the IP BOX relief for your company or partnership and will also support you at every stage of its utilisation.
The IP Box, or the IP BOX relief (Innovation Box, Intellectual Property Box), is a preferential taxation of income obtained from the sale of products or services manufactured or rendered on the basis of an intellectual property right. Entities that meet the requirements to use the IP BOX relief can take advantage of a lower PIT/CIT rate, which is 5%.
The IP BOX relief is available to payers of both personal income tax (PIT) and corporate tax (CIT), like companies. The period of running a business is not among the requirements, and the five per cent rate can be used by recently established entities as well as businesses that have been in the market for a longer time. Furthermore, the IP BOX relief also covers co-holders of intellectual property rights and entities that obtain profits from the resale of licensed rights for which they have an exclusive licence.
A prerequisite for using the preferential 5% income tax rate is that a given entity carries out research and development activities from which income is earned on the so-called eligible intellectual property rights, that is:
The IP BOX relief, addressed to entities creating and selling products or services based on intellectual property, is most often used in the IT, pharmaceutical and technology industries.
MDDP Outsourcing Experts remain at your disposal. We will be glad to answer any inquiries regarding our services, offer quotations and other issues related to our company.
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Accounting office in Warsaw
tel. (+48) 22 351 13 45
Accounting office in Katowice
tel. (+48) 32 797 83 50