The Stability Law introduced a Patent box regime in Italy in 2015. The Patent box regime is optional, it allows businesses to benefit from lower effective tax rates on profits derived from intellectual property.

This qualifying intellectual property includes patents, know-how, other industrial information and software, covered by copyrights, models and designs that could be legally protected. Trademarks qualify for the regime only if ongoing R&D activities are required for their development and maintenance. Additionally, a possibility to consider complementary intangible assets as a single intangible asset for the purposes of the Patent box regime was introduced in 2016.

The provisions in the Patent box regime are in line with the OECD nexus approach, which is defined by Action 5 of the OECD BEPS Project. It allows a taxpayer to benefit from an IP regime only to the extent that the taxpayer itself incurred qualifying research and development (R&D) expenditures that gave rise to the IP income.

The patent box regime may provide an exemption from corporate and regional income tax. The exemption is equal to 30% for 2015, 40% for 2016 and 50% starting from 2017, and is granted for five years. Read more.

Benchmarking Studies

With regards to the introduced Patent box regime, RoyaltyRange is pleased to provide a benchmarking study service, which offers an in-depth comparison of publicly available licence agreements and royalty rates in order to determine an arm‘s length (market) royalty rate range for your specific products or services.

The data provided by the RoyaltyRange benchmarking study may be used for:

• Ensuring transfer pricing compliance;
• Setting reasonable royalty rates;
• Negotiation of licence agreements;
• Intellectual property valuation;
• Consulting.

All agreements are manually analysed, rejected or selected, so that the final set consists only of agreements with the most comparable licensing terms. We use these agreements to conduct a Comparable Uncontrolled Price (CUP) analysis in order to calculate a royalty rate range that complies with the arm’s length principle, i.e. any royalty rate within this range is deemed to be at market rate.

Why RoyaltyRange?

• The licence agreement database is constantly updated with the newest transactions and consists of agreements which were typically concluded between unrelated parties and cover worldwide territory or the European region. This ensures that the data in our database reflects recent market practices.
• The agreements which make up the database have disclosed royalty rates in percentages.
• RoyaltyRange data is compliant with the OECD BEPS measures and the upcoming EU Anti Tax Avoidance Package.
• The RoyaltyRange team will finalise the whole process within several working days.

Interested in our services? Click here to read more and to place your request.