Telephone: (+350) 200 42686
Innovative and impartial international tax planning, company, trust and pensions services in Gibraltar for private clients, their businesses and their families.
Intellectual Property
A significant part of a company’s value can arise from its Intellectual Property (IP) and the underlying licenses.
This importance, combined with the flexibility of IP to be located, registered or utilised anywhere in the world, explains why IP is one of the most important and interesting aspects in international tax planning.
Gibraltar has a unique position when it comes to creating possibilities for IP tax planning, with:
Membership of the European Union (EU) via the United Kingdom as a EU Member State * accepted and implemented various EU directives, including the Royalty & Interest Directive
A tax system based on taxing only certain sources of income, and only when such sources are accrued in, received in or derived from Gibraltar
No taxation on outgoing interest and dividend distributions royalty distributions or capital gains.
This creates the possibility for royalties received by a Gibraltar company for the issued sub-licenses to its EU subsidiaries, to mitigate taxation when meeting certain conditions.
For example:
- No withholding tax royalty payments to a Gibraltar company
- Zero, or low, taxation of royalty income in Gibraltar
- Dividend distributions made by a Gibraltar company to its shareholders not subject to Gibraltar withholding tax.
The above are just a few examples of the various tax efficient structures possible when considering IP tax planning.
Given the potentially substantial value of the IP, possible anti-avoidance legislation and litigation in the jurisdictions regarding royalty distributions and relocation of IP, we highly recommended you obtain advice from tax planning professionals when considering IP (re)structuring.
To discuss how we can help you, please email us or telephone us on Gibraltar (+350) 200 42686 and ask for a member of the International Tax Team.
