Taxes Consolidation Act 1997 section 234

Certain income derived from patent royalties

Section 234 provided an exemption from income tax and corporation tax for income derived from qualifying patent royalties, subject to conditions and limits, but this exemption was abolished for payments made on or after 24 November 2010.

• Income from a qualifying patent could be disregarded for income tax or corporation tax purposes where the patent arose from research or development activity carried out in an EEA state and a claim was made in the prescribed form.
• An individual could only avail of the exemption if he or she personally carried out, solely or jointly, the research or development activity leading to the patented invention.
• The maximum amount of qualifying patent income that could be disregarded was capped at €5,000,000 per twelve-month relevant period, with connected persons required to share this cap between them.
• The exemption was abolished by the Finance Act 2011 and does not apply to income from a qualifying patent paid to a person on or after 24 November 2010.