Service tax exemption for intellectual property holders offsets tax by R&D cess amount, subject to timely payment and records. Exemption permits a holder of an intellectual property right to reduce service tax by an amount equivalent to the Research and Development Cess payable on the transfer of technology, subject to conditions: cess paid within six months of invoice (or date of credit for associated enterprises); cess paid at or before payment for the service; and maintenance of records linking the invoice or credit entry to the cess payment challan.