Dec. 2011 - Tax incentives for acquisition of Intellectual Property Rights
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Tax incentives for acquisition of IPR
Prior to the Inland Revenue (Amendment) (No. 3) Ordinance 2011, capital expenditure incurred by taxpayers to purchase intellectual property rights (“IPR”) would only be tax deductible if the IPR concerned were patent rights and rights to any know-how, the deduction of which is governed by Section 16E of the Inland Revenue Ordinance (“IRO”).
The Financial Secretary in his 2010 Budget Speech proposed to extend the tax deduction of IPR to cover copyrights, registered trademarks and registered designs in order "to promote the wider application of intellectual property by enterprises and the development of creative industries".
The Ordinance to effect the change, i.e. Inland Revenue (Amendment) (No.3) Ordinance 2011 ("the Amendment Ordinance") was gazetted on 16 December 2011.
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