Income Tax (Exemption) (No. 6) Order 2023 [P.U. (A) 384, gazetted on 19/12/2023], is an order that provides an exemption from income tax for qualifying biotechnology activities and companies.
The Income Tax (Exemption) (No. 6) Order 2023 exempts income tax payments to companies engaged in eligible biotechnology activities.
Qualified companies are granted a ten-year consecutive income tax exemption, subject to certain conditions that must be adhered to. This exemption does not include income derived from intellectual property obtained from the eligible activities.
The income tax exemption for qualifying biotechnology activities and companies lasts for ten consecutive years of assessment commencing immediately after the exempt years of assessment.
Under the Income Tax (Exemption) (No. 6) Order 2023, the following types of intellectual property income derived from a qualifying activity of the qualifying company are excluded from the exemption:
- Royalties and other income derived on or after 1 July 2018 but before 1 July 2021 from new intellectual property rights that the qualifying company owns.
- Royalties and other income are derived on or after 1 July 2021 from all the qualifying company’s intellectual property rights.
Any intellectual property income referred to is subject to tax under the Act.
