| Concept Guidance: |
A royalty is defined as a right to use the property of another person for economic gain. This is usually an intellectual property, such as a copyright (e.g. in a book) or a patent (e.g. in an invention). Natural resources are defined as unexploited products of nature that have economic value e.g. forests, petroleum deposits, ore deposits.Natural resource royalties refers to the right to use the unexploited products of nature which have economic value on land owned by another person for economic gain.Royalties expenses excluding natural resource royalties refers to the payments a business makes in exchange for the right to use the property of another person for economic gain, other than for natural resource royalties.
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| Form-Specifc Guidance: |
Royalties (other than royalties for natural resources) are payments made by one business or individual for the use of rights owned by another company/person. Do not deduct withholding tax.
Include:
- payments under licensing arrangements; and
- payments for royalties from intellectual property (e.g. patents, copyrights, etc.).
Exclude:
- expensed computer software licence fees (include in 'Computer software expensed'); and
- capitalised computer software licence fees (include in 'Capital expenditure').
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