The name is obscure, "Patent Box". It is not a box and the driving license has nothing to do with it: it is a tax relief for income deriving from the (direct or indirect) use of intangible assets such as software, designs, models, industrial patents, trademarks and know-how. how. The bonus was introduced by the 2015 Stability Law and subsequently modified by this year's maneuver. To clarify how it works, the Revenue Agency has published a circular drafted in collaboration with the Ministry of Economic Development.
HOW THE PATENT BOX IS CALCULATED
In essence, the Patent Box makes it possible to reduce the tax base (and therefore the tax levy) for Irpef or Ires purposes, as well as for Irap purposes. The steps to follow to determine the facilitation, explains the taxman, are three:
I. identify the eligible income deriving from direct or indirect use
of the intangible asset;
II. calculate the nexus ratio, given by the ratio between qualified costs and costs
overall;
III. calculate the product between the eligible income and the nexus ratio, thus obtaining the portion of eligible income, which is reduced by 30% on the business income for 2015 and by 40% for 2016. For the following years, the reduction will be 50 %.
In order to allow access to the regime also to those companies that do not yet have analytical management accounting systems, in the first three years of application of the facilitation, the nexus ratio can be determined by considering the qualified costs and the total costs as aggregate quantities, i.e. say without distinction for single intangible asset.
Lastly, the Revenue Agency clarifies that the eligible income consists of the positive components such as "implicit royalties" or fees deriving from the concession to use the intangible assets, net of the directly and indirectly relevant fiscal costs connected to them. To determine the eligible income, therefore, the fiscally recognized costs, including the fiscally relevant depreciation, are valid.
PATENT BOX AND RULING APPLICATION
The circular therefore examines the relationship between exercising the Patent Box option and submitting the ruling application (the procedure agreed between the private individual and the Revenue Agency to determine the economic contribution deriving from the intangible asset). In short, the option is not invalidated if the ruling request should lapse due to failure to submit the supplementary documentation within the terms.
PATENT BOX AND "BONIS REMISSION"
The option can also be exercised late by making use of the "remission in bonis", an amnesty with which taxpayers who have not complied with their obligations in time are granted the possibility of avoiding forfeiture of the benefit. It is sufficient to comply with the obligations omitted by the deadline for submitting the first useful tax return (in this case by 30 September 2016) and paying a minimum fine of 24 euros in F258. Taxpayers who have an ongoing assessment that also concerns the fulfillment subject of the amnesty cannot take advantage of the remission in bonis.
MARKETING COSTS ALSO IN THE PATENT BOX
The circular also explains that the expenses incurred for "presentation, communication and promotion activities" are among the qualified costs to be considered in the nexus report. Naturally, these expenses can be included in the nexus ratio only if they refer "to a brand subject to an option - reads the text -, in cases in which the same is facilitated as an independent asset or as a complementary asset to other IPs".
PATENT BOX AND SEARCH
Expenses for fundamental research (those whose primary objective is theoretical understanding) are included in the nexus ratio limited to the tax period during which the knowledge acquired is translated into applied research. Research that is not successful, on the other hand, should not be considered for the purposes of the nexus ratio.
PATENT BOX AND EXTRAORDINARY TRANSACTIONS
In the event of mergers, demergers and company transfers, the incorporating company takes over the exercise of the Patent Box option carried out by the incorporated company. The financial administration will assess on a case-by-case basis whether or not the companies involved in the extraordinary operations comply with the envisaged conditions.
Read the full text of Circular No. 11/E of the Revenue Agency – pdf.
