The transfer of patent use right belongs to the income from property transfer. Those who obtain royalties through the transfer of patent use rights need to pay personal income tax according to regulations. When transferring the right to use a patent between the parties, an exploitation license contract must be concluded.
Legal objectivity:
Article 10 of the Patent Law of People's Republic of China (PRC) * * * The patent application right and patent right can be transferred. Where a unit or individual in China transfers the right to apply for a patent or the patent right to a foreigner, foreign enterprise or other foreign organization, it shall go through the formalities in accordance with the provisions of relevant laws and administrative regulations. Article 12 of the Patent Law of People's Republic of China (PRC) Any unit or individual who exploits another person's patent shall conclude an exploitation license contract with the patentee and pay the patentee the royalties. The licensee has no right to allow any unit or individual other than those stipulated in the contract to exploit the patent. Article 2 of the Individual Income Tax Law of People's Republic of China (PRC) shall be subject to individual income tax: (1) Income from wages and salaries; (2) Income from remuneration for labor services; (3) Income from remuneration; (4) Income from royalties; (5) Operating income; (6) Income from interest, dividends and bonuses; (7) Income from property lease; (8) Income from property transfer; (9) Accidental income.