Patent Box

Patent Box

The Patent Box is a Government scheme through HMRC that provides UK companies that hold qualifying IP rights or an exclusive IP license, and receive relevant IP income, the opportunity to benefit from a reduced rate of corporation tax on relevant profits.

From 1st April 2017 this rate is 10%.

Applied to company profits from eligible patents or other qualifying intellectual property rights such as :

  • Patents granted by the intellectual property offices UK IPO and EPO;
  • Patents granted by the national intellectual property office of 13 EEA countries;
  • Medicinal & botanical IP rights (e.g. supplementary protection certificates);
  • Exclusive licences for patented inventions developed, exploited and defended by the licensee;
  • Patents acquired from another company, actively managed or developed by the acquiring company.

Profits will be calculated using revenue streams from global sales of:

  • patented products;
  • products incorporating one or more patented inventions;
  • bespoke parts used in the patented product(s);
  • licence fees, royalties or proceeds from the sale of the patent;
  • Compensation/damages resulting from patent infringements

ABGI UK can assist in compiling and assessing associated costs and tracked profits from relevant patent protected products, and advise on:

  • The implications of existing R&D eligible expenditure on calculation of relevant IP income;
  • Managing corporation tax benefits of the combination of both R&D tax relief and Patent Box schemes;
  • On-going legislative changes & impact on current or future patent box claims;

We will prepare the Patent Box report and associated calculation for inclusion in your tax return.


Have a question? We’re happy to help!