Pay 50% less tax on profits from Intellectual Property with KDB

Knowledge Development Box (KDB) tax relief - Crowe Horwath Ireland

Take our short test to see if you are eligible to pay 50% less tax on profits from Intellectual Property through the Knowledge Development Box regime.

What is the Knowledge Development Box (KDB)

The KDB is a tax relief applying to income from qualifying patents, computer programmes and other certified intellectual property (IP).

Introduced in the Finance Act 2015, KDB applies in respect of accounting periods commencing on or after 1 January 2016. The introduction of this tax regime aims to reward those companies who invest time and effort into legally protecting their intellectual property.

What is the tax relief available?

If a company qualifies for KDB, it may be entitled to a deduction equal to 50% of its qualifying profits from patented inventions and copyrighted software developed in Ireland. This means its qualifying profits may be taxed at 6.25%.

Unlike research and development (R&D) tax benefits, which are only available for the duration of an R&D project, KDB benefits apply as long as income is generated from the intellectual property.

Is your company entitled to avail of the KDB relief?

If you answer yes to each of the following questions, your company could be eligible for a valuable corporation tax saving.

  1. Has the company conducted R&D?
  2. Did the R&D result in a new invention or software?
  3. Has the invention been patented or does it qualify*?
  4. Are you generating profits from the patented invention or copyrighted software?
  5. Do you want to make a significant tax saving on these profits?

How can we help?

Crowe Horwath’s KDB team is available to help determine if your company is eligible to receive tax relief and can help prepare the documentation for your KDB claim. Contact our tax team for more information.

* Qualifying assets are: an invention protected by a patent, copyrighted software and other intellectual property which is certified by the Controller of Patients as patentable, but not yet patented.