What is 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%, which is 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.
How are the profits calculated?
Profits will be calculated using revenue streams from global sales of:
Products incorporating one or more patented inventions
Bespoke parts used in the patented product(s)
Compensation/damages resulting from patent infringements
Licence fees, royalties or proceeds from the sale of the patent
What will ABGI UK do for you?
We will 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.
How much could I expect?
The Patent Box programme can offer generous savings in corporation tax. Our user-friendly calculator will estimate the tax benefit you could receive from HMRC.
*Please note that estimate of tax benefit is intended as a guide only and is in no way guaranteed. It is based on the figures you have input. ABGI are experts in maximising R&D tax relief benefits - please contact us to ensure you secure every last penny you’re entitled to.