AMDOCS is in talks to transfer intellectual property to Israel


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Information technology business systems company, Amdocs Ltd. (Nasdaq: DOX) Talks with the Israeli tax authority about transferring the company’s intellectual property to Israel in exchange for billions of shekels in tax benefits, Globe sources reported. The tax benefits that Amdocs will receive are included in the Law to Encourage Capital Investments in Israel and include a tax rate of only 6%. The corporate tax in Israel is 23% but AMDOC has paid a much smaller percentage in Israel for many years under the same law. Globus learned that AMDOC has requested a pre-judgment from the Israel Tax Authority regarding the rate of tax it will pay for the transfer of its intellectual property to Israel and the discovery of disputes that may arise. Among the issues that Amdocs would like to clarify is the value of purchasing IP from companies in the Amdocs Group abroad, for the purpose of transferring it to Israel. Amdocs specializes in communications billing services and CRM systems management and its clients include major international players such as T-Mobile, Vodafone, SingTel and MGM. Amdocs has developed systems that enable these companies to move operations to the cloud and enjoy 5G infrastructures with a high-quality user experience. Amdocs operates in 85 countries and has 350 customers. The company has 26,000 employees, 20% of them are in Israel and has offices in Ra’anana, Nazareth and Sderot. The company has development centers in Israel, the United States, India, Cyprus and Brazil. AMDOCS is currently building a new campus for innovation in Ra’anana, at a cost of 350 million shekels, and construction is due to be completed next year. Revenue in 2020 is $ 4.2 billion, and the company is trading on the Nasdaq with a market value of nearly $ 11 billion. Amdocs is exactly the type of company that the state and the Israeli tax authority were targeting when enacting the Capital Investment Promotion Law and its tax incentives for exporters whose assets are based on intellectual property, such as software systems. “A group the size of Amdocs can expect a 6% tax on profits generated by intellectual property (compared to 23% on corporate tax),” said attorney Yaniv Shekel, senior partner in the Shekel & Co law firm who specializes in tax matters. NIS that there is also a tax exemption in the distribution of dividends. ”Given these benefits, it was often feasible for companies operating outside Israel not to pay tax on them here but in foreign countries, while transferring their intellectual property to Israel and paying a reduced tax on Amdocs refraining from Comment on this report. Related materials Amdocs bought 5G cloud tech co Openet for $ 180 million Amdocs to lay off hundreds and the Israel Tax Authority said, “We are unable to comment due to the law’s commitment to secrecy.” Posted by Globes, Israel business news – en.globes.co.il – on March 16, 2021 © Copyright Globes Publisher Itonut (1983) Ltd. 2021


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