Intellectual property taxation

(FINANCING RESEARCH AND INNOVATION – OPTIMIZATION OF CONCESSION/CESSION OF RIGHTS) – DEFENSE AND LITIGATION)

Intangible assets are major contributors to company value in a wide range of sectors. They are also easily relocatable from a legal point of view, thanks to the recognition of property titles by the competent authorities in the various countries (INPI for France).

Tax and accounting rules applying to the various intellectual property rights (patents, trademarks, designs, know-how, copyright, software, etc.) can give rise to preferential tax regimes, both for the development of these rights (CIR, CII in France, for example) and their exploitation (patent concession regime, for example), as well as tax depreciation rules.

They are also particularly scrutinized by tax authorities because of their high cost to the public purse (the CIR is one of the government’s biggest tax expenditures).

In this complex environment, AlterTax can help you secure and optimize the taxation of your intellectual property:

  • Preparation and assistance in setting up the CIR/CII (including analyses of innovative and patentable character by our CPI partners). Quantitative analysis, tax rulings
  • Valuation and justification of intangible asset royalties (benchmarks and economic analyses)
  • Defense in tax audits and litigation
  • Preparation of specific documentation
  • Analysis of the nexus system (in an international context)
  • Representing the taxpayer in litigation before the administrative courts
Cyril Maucour, tax lawyer with AlterTax

Cyril Maucour lawyer, expert in intellectual property taxation

I’m Cyril Maucour, Managing Partner of AlterTax, with over 20 years’ experience in IP taxation. I specialize in assistance with tax audits and litigation, offering my services to a varied international clientele, including entrepreneurs, SMEs and ETIs in various sectors such as industry, new technologies and pharmaceuticals. My multi-sector expertise enables me to provide effective advice to any company in need of an expert international tax lawyer.

It’s good to be informed, but it’s even better to be accompanied by an expert tax lawyer. Let’s get in touch.

FAQs on intellectual property taxation

Here are some frequently asked questions about the taxation of intellectual property:

What is intellectual property (IP) in tax terms?

In tax terms, intellectual property includes intangible assets such as patents, trademarks, copyrights and know-how. These assets can generate income (such as royalties) and may have tax implications.

How is IP income taxed?

Income generated by IP, such as royalties, is generally taxable. The tax rate depends on local legislation and the type of income (business income, personal income, etc.).

Are there any tax benefits associated with IP?

Yes, some countries offer tax incentives to encourage innovation and IP development, such as tax credits for research and development (R&D) or special tax regimes for IP income.

How are IP transfers treated for tax purposes?

Transfers of IP, such as sales or licenses, may be subject to capital gains tax. Rules vary from country to country and may depend on the nature of the transfer.

What about IP depreciation?

Certain IP assets can be depreciated for tax purposes over their useful life. This can reduce the tax base of the entity holding the IP.

How does international taxation affect IP?

International taxation can be complex for IP, especially if the owning entity operates in several countries. Issues of transfer pricing and the location of IP assets are becoming crucial to minimizing tax burdens.

What are the tax implications for IP donations?

Yes, tax treaties between countries can affect the way IP income is taxed, particularly in cross-border situations.

How do you stay compliant with IP tax regulations?

Keeping abreast of local and international tax laws, consulting tax experts and keeping accurate records are essential to ensure compliance.

Are IP development costs deductible?

In many cases, the costs of developing IP (such as research costs or patent lawyers’ fees) may be deductible. This depends on local tax rules.