If you own or exclusively licence patents our specialist Patent Box tax advisors can help you maximise the significant tax savings you are entitled to.
We thought it would be useful to remind you that the Patent Box legislation took effect from 1 April 2013. This includes accounting periods straddling that date. Where a company has ‘qualifying patent box income’ a new 10% rate will eventually apply to all such profits. The rate is being phased in over a four year period such that 60% of eligible profits are initially subject to the lower rate.
The starting point is to consider whether your company or group is eligible. It is available to companies liable to UK corporation tax which own or exclusively licence patents from which qualifying patent related income is derived. The patents must have been granted by the UK Intellectual Property (IP) office, the European Patent office or by other IP offices in specified EEA countries.
A company, whether independent or in a group, must have carried out the development work in respect of the patented item or process in order to qualify. In addition, a group company may qualify where another group company was involved in the development process. This is subject to the requirement that the group company making the claim is actively involved in the management and decision making of its portfolio of eligible patents.
For further information on what is qualifying patent related income please do contact Stephen Charles at firstname.lastname@example.org to review whether your company or group could qualify.
Disclaimer – for information of users: This briefing is published for the information of clients. It provides only an overview of the regulations in force at the date of publication and no action should be taken without consulting the detailed legislation or seeking professional advice. Therefore no responsibility for loss occasioned by any person acting or refraining from action as a result of the material contained in this briefing can be accepted by the authors or the firm.