The Patent Box is a tax incentive offered by the UK Government to companies to encourage them to undertake R&D, and protect the resulting intellectual property (IP) by applying for a UK patent.
The Patent Box allows profits derived from patents to be taxed at a corporation tax rate of just 10%, which is significantly lower than the headline rate of 25%.
The Patent Box application process can appear complicated. Our team of tax advisors and patent attorneys at Gateley have joined forces to make the process as simple as possible by breaking it down into three easy-to-follow steps, with all stages being a collaborative process, between Gateley and yourselves.
What is the Patent Box claim process?
Our streamlined 3-step process takes 12-18 months:
1. Preparation (month 1)
- Review of IP, R&D expenditure, and associated revenues to establish if Patent Box is viable.
2. Filing, examination and grant (months 1-18)
By working to a set process we can offer to fix the cost of your patent application at the outset to cover all the standard steps that are involved in achieving a granted UK patent.
3. Calculation and claim (month 18)
- Once the patent has been granted, election into the Patent Box scheme can take place.
- Include the Patent Box deduction into CT600 submission and, alongside supporting tax analysis, identify the total tax saving.
Accelerated patent protection for Patent Box
The UK patent application process involves a few key stages before a patent can be granted. Under normal circumstances, the sequence of these events can take between two and four years to result in a granted patent. However, the possibility of achieving corporation tax savings under Patent Box means applicants may want to accelerate the UK patent application process.
Patent attorneys at Adamson Jones have developed a streamlined way of working to achieve granted UK patents more quickly where Patent Box is the key driver. By working to a set process we can offer to fix the cost of your patent application at the outset to cover all the standard steps that are involved in achieving a granted UK patent.
Using this approach, we have been able to achieve a granted patent within as little as 12 months. This leaves plenty of time available to backdate any potential Patent Box savings for profits derived from the patented invention, provided you have elected into Patent Box rules in advance.
Calculation and claim done correctly
A Patent Box claim requires both a technical and financial justification. At Gateley Capitus we can bring the claim together on your behalf using our tax specialists and technical professionals.
Calculating the final figures for a Patent Box application isn’t straight forward and requires us to work with you to identify specific revenue streams, assess each IP right individually, look at the R&D involved, and apply a complex HMRC formula. We will ensure that a robust claim is put together using our rigorous process to identify your full benefit, whilst providing a clear justification to HMRC.
Why claim Patent Box?
Capitus Director, Steven Bone, explains the benefits of claiming Patent Box.