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If I've understood it correctly, the subsidary in the tax haven actually owns the IP and then licenses it out to the proper company at high rates. This way, the
by oliwary 12y ago
If I've understood it correctly, the subsidary in the tax haven actually owns the IP and then licenses it out to the proper company at high rates. This way, the profits are shifted from the regular firm to the company in the tax haven, and as only profits are taxed the company can stay largely tax free.
- 6stringmerc 12y agoWell, if the IP is generated in the US, then gets transferred (sold) to a wholly owned subsidiary at a "negotiated rate" (not mark-to-market), which is then charged back to the inventing parent who no longer technically owns the IP, it's a matter of paperwork...if I understand the situation correctly from what I've read...