Royalty shall be deemed periodic payment of an amount to the author for authorization to use the subject of the license agreement. Normally, royalty is determined as percent of total sales of licensed goods or products. For instance, periodic fee paid to the author for each use or public reproduction of copyright.
In some cases royalty is also determined as a fixed fee for particular period.
Royalty may be deemed as compensation for use of copyright or patent or other intellectual property. Compensation is paid as a percentage of the total sales of goods or services entailing disposal of copyright or patent.
Since there are no taxes assessed against individuals and legal entities in the United Arab Emirates royalty and other income are not subject to taxation. Accordingly, the source of amounts designated for payment of royalty can be both in the UAE and abroad.
