The government is set to extend tax reliefs for intellectual property as it seeks to increase Ireland's attractiveness to multinational companies.

The reliefs were introduced last year and allow eligible companies to drop their effective tax rate below the 12.5% headline rate.

"A further extension of tax support in that regard can be expected," a department source said in relation to the upcoming Finance Bill.

The range of intangible assets qualifying for relief includes patents, brands, trademarks, copyrights and publishing rights. The tax credits are in the form of capital allowances and are allowed against trading income.

To claim the tax relief companies must "trade" with the new intangible assets which should ensure further development. The existing legislation applies to expenditure incurred after 7 May of last year.

The writeoff can be taken in the current tax year or spread over 15 years and the legislation makes clear that avoiding tax cannot be one of the main purposes for the acquisitions.

Sources in the department described as incorrect rumours that companies would be given tax credits to write research and developments costs off against PRSI contributions.

Much of the final version of the bill is being decided this weekend via consultations between Fianna Fáil and the Green Party.

Closing a loophole that allowed developers avoid stamp duty through a mechanism called resting on contract "remains under consideration", the department sources said.