Allens Arthur Robinson: Publication: Focus: Tax disputes involving s25-90 interest deductions – ATO lose challenge to deductions on funding royalty stream acquisition
I’ve been thinking about doing a podcast for a while, and decided to experiment with a podcast on the highlights of the Budget for IP. It should stream in the browser, let me know if you want to hear more in future.
- R&D tax relief increased for SMEs to 200% in 2011 and 225% in 2012
- R&D tax credit repayment no longer restricted by PAYE/NICs
- R&D large company relief to include sub-contractor costs
- Patent box to have more consultation – still 10%, still patents only, applying from 1 April 2013
- Capital allowances for short-life assets now 8 years – useful for capital expenditure that doesn’t qualify for R&D allowances, and exceeds the annual investment allowance
- Reductions in corporate tax rate useful to all companies
- Enterprise Zone changes could be attractive
- 24 new University Technical Colleges to be established
Whilst I’m writing up the Budget changes, this amuses me – the Budget in black and white, via Wordle
Seems similar to UK R&D tax incentive, but possibly easier to spot qualifying R&D.
Allows acquiring company to write off net value of IP in acquired company over 5 years – both acquirer and acquired must be companies incorporated and managed/controlled in Israel, so has very limited application globally.
Allows investor to write off investment up to NIS 5m over three years against income in Israel – open to foreign investors with Israeli income as well as Israeli investors.
Immediate updates on IP-related Budget thoughts will be posted on twitter – a more detailed update will be posted here when I’ve had time to read through the inevitable small print that arrives after the Chancellor sits down!
What’s expected on IP tax (at least):
- an update on CFCs – should have some IP content to it
- update on the consultation on IP tax and R&D which closed on February 22nd
- more information on the patent box (in the consultation update)
There might be more …