Knowledge Development Box amendments effective from 1 October 2023

The Minister for Finance, Michael McGrath TD has signed the Commencement Order to implement Finance Act 2022 amendments, providing for an increase of the effective tax rate for the Knowledge Development Box (KDB), with effect from 1 October 2023. 

The KDB provides relief from corporation tax on income arising from qualifying assets such as computer programs, inventions protected by a qualifying patent, or certified inventions for SMEs. The amendments are in line with the implementation of Pillar Two Solution of the OECD agreement and demonstrate Ireland’s continued commitment to agreed international tax reforms. 

Commenting, Minister McGrath said: 

“This is an important step in the implementation of the OECD Two Pillar agreement. Ireland is fully committed to agreed international reforms. Work is continuing to transpose the EU Minimum Tax Directive in Ireland in the Finance Bill this autumn, to provide for the 15 percent minimum effective corporation tax rate element of Pillar Two.”