Patent Box

Protecting your R&D investment with Patent Box

Patent Box claims from R&D Tax Claims

Most companies that obtain patents have carried out R&D at some point. However, very few SMEs protect their IP despite claiming R&D tax relief on an annual basis. Patent Box aims to change that.

Introduced in April 2013, the Patent Box tax break encourages UK companies to take out patents and protect their IP. It is one of the most attractive forms of this relief world-wide and is further evidence of the importance of encouraging innovation in order to help the UK Economy.

In simple terms, the aim of Patent Box tax relief is to enable profits arising from patented products and processes to be taxed at a lower rate than non-patented  profits (10% by 2017 rather than the current rate of 20%).

It is only available to companies who have actually been granted their patents but can include profits from pending patents, up to a maximum of six years, once those patents are finally granted, by making a retrospective claim.

Patent Box is available to any companies who have the
following interests in IP:-

  1. The sale of patented products including products incorporating patented parts. (e.g. if a company manufactures and sells photocopiers which incorporate a toner cartridge on which they hold the patent, the profits on the sale of the photocopiers are eligible for Patent Box relief not just the amount attributable to the toner cartridges).
  2. Licence Fees and royalties including the sale of IP rights.
  3. Income derived from infringement of IP rights.
  4. Commercial exploitation of IP rights.


R&D Tax Relief and Patent Box work in conjunction with each other. Therefore the key to maximising the tax effect of Patent Box lies in maximising R&D Tax Relief.  It makes good sense to talk to people who understand how best to combine these very attractive reliefs.

We can help you with understanding how the Patent Box can help your company save tax, whether that means finding out if you are able to patent a new product or process or helping you with maximising the relief itself through a detailed understanding of the interaction with R&D Tax Relief.

Contact us for more information about Patent Box

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