Patent Box

Reduced Tax on Patent Income

Please download our Patent Box Factsheet (537 KB)

Your company could pay a substantially reduced rate of corporation tax on the income it derives from the licensing or selling of patent rights which it owns and develops.

Income from the development of such patented products, processes or services could be taxed at just 10% instead of the normal rate of corporation tax. This reduced rate is being phased in up to 2017 and is given by providing an additional deduction in the corporation tax computation.

The previous version of Patent Box closed to new entrants from June 2016, though existing participants will continue to enjoy the benefits until June 2021. Details of the revised scheme are being formulated. It is also planned that relief will only be provided in future to companies which have developed an invention in the UK.

Where your company is part of a group, it may still be eligible for the reduced rate even if the development work was carried out by another group member, subject to certain conditions.

Patent Box Team

Our Team

If you feel that your company may qualify for reduced corporation tax under the Patent Box regime, contact Bishop Fleming now.

Our knowledge and experience of this valuable relief allows us to work with you in ascertaining how much relief can be claimed. Our in-house team includes specialists who understand the legislation and its practical application, as well as a wide range of other tax experts on matters such as international tax and transfer pricing.

Our team will be able to recognise the wider implications of Patent Box for the benefit of your company. We also work with patent attorneys who know how to register patents and apply them to products.

Processes

As experienced Patent Box advisers we will meet with you to discuss your requirements and to explain how Patent Box works. Following that we will carry out a study into how much your company could benefit from Patent Box.

Our process will include identifying what intellectual property may qualify for the Patent Box regime and whether all the necessary conditions for qualification are met. We will also consider the most suitable calculation to use.

We will liaise with HMRC on your behalf to secure the Patent Box deduction.

Do your patents qualify?

Your company must hold a patent granted by the UK Intellectual Property Office, the European Patent Office or an equivalent other office in another part of the European Economic Area. There must have been significant activity in developing the patented invention.

If your company doesn’t currently hold a patent then you may wish to look at ways that it could come within the Patent Box regime. We will be able to advise you on this.

As the previous version of Patent Box closed in June 2016, it is important to contact us as soon as possible to discuss your exact requirements.

What about R&D relief?

If your company is already claiming R&D relief, the Patent Box rules operate in such a way as to work along side this in order that you can also claim for Patent Box.

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