Intellectual Property Luxembourg
Protect and optimize your intellectual property in Luxembourg. IP Box regime (4.99% effective rate), trademark registration, licensing, and IP structuring.
In summary: Luxembourg offers a competitive IP regime with 80% exemption on qualifying IP income (effective rate ~4.99%). Qualifying IP includes patents, software copyrights, and utility models. Trademark protection available through Benelux (BOIP) or EU (EUIPO) registration.
Intellectual Property in Luxembourg
Luxembourg offers an attractive environment for intellectual property management, combining strong legal protection with one of Europe's most competitive IP tax regimes.
IP Box Regime
Key Features
| Aspect | Details |
|---|---|
| Exemption rate | 80% of net qualifying IP income |
| Effective tax rate | ~4.99% (based on 24.94% standard rate) |
| Qualifying IP | Patents, software copyrights, utility models |
| Nexus approach | OECD-compliant modified nexus |
| Capital gains | 80% exemption on qualifying IP disposal |
Qualifying Income
- Royalties from licensing IP
- IP embedded in goods or services
- Capital gains on IP disposal
- Damages for IP infringement
Modified Nexus Calculation
The net income qualifying for the 80% exemption is calculated as:
Qualifying Income = Net IP Income × (Qualifying R&D Expenditure × 130%) / Total R&D Expenditure- Qualifying R&D: Self-performed R&D and outsourced to unrelated parties
- Non-qualifying: Acquired IP cost, related party outsourcing
- 130% uplift: Incentive for own R&D activities
Trademark Protection
Registration Options
| System | Coverage | Office |
|---|---|---|
| Benelux | Belgium, Netherlands, Luxembourg | BOIP |
| EU Trademark | All EU member states | EUIPO |
| International | Madrid Protocol countries | WIPO |
Registration Process
- Prior art search
- Application filing
- Examination by office
- Publication for opposition
- Registration (if no objections)
- Duration: 10 years, renewable
Patents
Patent Protection
- European patent: Via EPO, validated in Luxembourg
- Unitary patent: Single protection across participating EU states
- Luxembourg national patent: Limited to Luxembourg territory
Software Protection
Software is protected by copyright in Luxembourg and qualifies for the IP Box regime.
- Automatic protection upon creation
- Registration not required but advisable
- 50-year protection term
- Qualifies for 80% IP Box exemption
IP Structuring
Luxembourg IP Holding
- Central IP ownership for groups
- Licensing to operating companies
- IP Box benefits on royalty income
- Treaty access for withholding tax optimization
- Participation exemption on IP company shares
Our Services
- IP Box regime structuring
- Trademark registration and portfolio management
- Patent strategy and validation
- Licensing agreements
- IP due diligence
- IP transfer pricing
- Enforcement and infringement actions
Frequently Asked Questions
The Luxembourg IP Box provides an 80% exemption on net income from qualifying intellectual property, resulting in an effective tax rate of approximately 4.99%. Qualifying IP includes patents, software copyrights, utility models, and certain trademarks linked to qualifying IP.
You can register a trademark through the Benelux Office for Intellectual Property (BOIP) for protection in Belgium, Netherlands, and Luxembourg, or through the EUIPO for EU-wide protection. Registration takes approximately 4-6 months if no objections.
Qualifying IP includes: patents, copyrighted software, utility models, supplementary protection certificates, and certain trademarks (if linked to qualifying IP). Trade secrets and copyrights other than software generally do not qualify.
Net IP income is calculated using the modified nexus approach: only income proportional to R&D expenditure incurred by the taxpayer qualifies. Acquired IP must have substantial qualifying expenditure added to benefit from the regime.
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