Patent Box - 25/09/2017
The Patent Box regime was conceived as an incentive for companies to commercialise their intellectual property (IP) in the UK.The more familiar Research & Development Tax incentives regime having encouraged companies to create IP since April 2000, the Patent Box regime is aimed at the subsequent commercialisation of that IP within the UK.

Phased in from April 2013, Patent Box Relief provides a reduced rate of Corporation Tax for companies exploiting patented inventions or other innovations protected by certain intellectual property rights. Patent Box Relief is designed to enable companies to reduce the effective rate of Corporation Tax for qualifying profits to 10%.

This reduced rate applies to a proportion of the profits derived from the licensing or sale of the patent rights or from the sale of the patented invention or products, which incorporate the patented invention. Profits derived from routine manufacturing, development or exploitation of brands and marketing intangible assets are excluded.

Taking one of our specialist sectors - Agriculture - as an example, we can see that innovation in the industry is improving performance, yields and profits. The Patent Box regime could provide significant tax savings for the sector.

Today’s farmers require the latest equipment and technology with some of the most successful farming machinery actually being developed on the farm. The Patent Box regime may apply to more ideas than you initially think.

The regime applies to accounting periods beginning on or after 1 April 2013. As the regime is only open to companies, innovative farming businesses may wish to consider incorporating to take advantage of the regime. The UK government acknowledges that introducing the regime is likely to increase the incentive to incorporate and are encouraging businesses to take advantage of the special tax relief. We are already exploring this with some of our existing clients and can work with you in preparing and submitting a claim to maximise your prospects of benefitting from this potential tax relief. 
 

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