What is Patent Box, and what is it worth?
The Patent Box regime allows companies that own or exclusively license qualifying intellectual property to benefit from a reduced rate of Corporation Tax on profits linked to their patented inventions.
Instead of the standard Corporation Tax rate, qualifying profits are taxed at an effective rate of just 10%, offering significant potential tax savings for innovative businesses.
Who can claim Patent Box?
This relief may be available to UK companies subject to Corporation Tax where the following conditions are met:
- The company owns, or holds exclusive rights to, a patent granted by the UK Intellectual Property Office, the European Patent Office, or certain EEA countries; and
- The company has contributed meaningfully to the development or creation of the patented invention, or products that incorporate it.
How to claim Patent Box
Claiming under the Patent Box regime can be complex, involving detailed calculations and careful apportionment of qualifying profits. Our R&D Incentives specialists can manage the process with you and help ensure your claim is accurate and compliant.
Even if your patent is still pending, it’s worth speaking to us early. Relief can often be backdated to the date of application and claimed once the patent is granted.
Patent Box FAQs
How do I know if my business has intellectual property that could benefit from Patent Box?
Many businesses focus on patents only as a legal protection tool and overlook their potential tax benefits.
If your business owns, develops or commercialises patented technology, products or processes, it may be worth reviewing whether Patent Box could apply.
Does Patent Box only benefit large companies?
No. Businesses of different sizes may benefit if they hold qualifying intellectual property and generate relevant profits from it.
Can Patent Box apply to profits generated from products rather than licensing income?
Yes. Patent Box can apply to certain profits linked to patented products and innovations, not just direct licensing income. The rules are complex, so professional advice is recommended.
How does Patent Box complement R&D Tax Relief?
R&D Tax Relief supports businesses while they are developing innovation, whereas Patent Box can provide additional benefits once that innovation generates commercial returns.
Together, they can form part of a wider strategy to support investment in innovation.
Could Patent Box benefit your business?
If your company owns or is developing patented innovations, it may be worth exploring whether Patent Box relief is available.
Our team can help you understand the rules, assess your position, and support you in making a compliant claim.
Take a look at our R&D Incentives case studies...
Biotechnology
Industry: R&D Incentives
- £2,368,372
- £3,737,519
- £1,230,821
Could Patent Box benefit your business?
If your company owns or is developing patented innovations, it may be worth exploring whether Patent Box relief is available.
Our team can help you understand the rules, assess your position, and support you in making a compliant claim.
Discuss your Patent Box opportunities with our specialists.