Navigate Up
Sign In

Intellectual Property – Article 14(1)(m) of the Income Tax Act

​It is hereby clarified that:

(i) the wording contained in Article 14(1)(m) of the Income Tax Act shall be interpreted to apply in respect of:

any expenditure of a capital nature on intellectual property or any intellectual property rights incurred by a person and which intellectual property or intellectual property rights are proved to the satisfaction of the Commissioner to have been used or employed in the production of the income of such person:
Provided that any such expenditure shall be spread equally over a number of years which shall not be less than a minimum period of three consecutive years, the first year being that in which the said expenditure has been incurred or the year in which the intellectual property or intellectual property rights is/ are first used or employed in producing the income.
 
Indeed, any expenditure of a capital nature on intellectual property or any intellectual property rights which is spread equally over a minimum period of at least three consecutive years shall be considered to constitute a reasonable manner in which such expenditure can be spread over the life of such intellectual property or intellectual property rights.
 
(ii) in case of transfers of intellectual property or intellectual property rights held as a capital asset, the taxation of any sums receivable therefrom shall be regulated exclusively by the provisions of Article 5 of the Income Tax Act.
 
This Guideline shall apply with effect from the year of assessment 2017.