From 1 January 2012, 80% of the profits emanating from the exploitation of registered IPs (i.e. royalty income) received by a Cyprus tax resident company, reduced by the annual amortization charge on the cost of acquisition of the IPs over a 5-year period (i.e. 20%) and any other deductible expenses, is exempt from corporation tax.
In addition, upon the disposal of the IP itself, 80% of any subsequent profit (representing the difference between the sales proceeds and the tax written down value, i.e. the unamortized cost of acquisition of the registered IPs) is also exempt from corporation tax.