Patent Box changes from 1 July 2016

May 10, 2016

The existing scheme will be closed to all new entrants from 1st July 2016 – in practice this means companies who have not commenced the patent application process by that date will go into the new regime.

If you have already elected into the Patent Box regime, you will be able to continue to enjoy the existing 10% corporation tax rate on eligible patent box profits until 30th June 2021.

Some IP assets acquired on or after 2nd January 2016 may also go into the new regime.

The post 1st July 2016 rules introduce a nexus based regime which should mean the IP profit will qualify for the special rate of 10% if the majority of the IP research and development activity has been carried out by the company itself.

The record keeping and administrative costs of identifying the relevant IP income and costs will become more onerous under the nexus based approach.

This is something that the Patent Box and R&D Tax Credit specialists at Henderson Loggie can help you with if you have not yet considered this but you need to act fast !

Please contact either Dougy Agnew dougy.agnew@hlca.co.uk or Barbara Walton barbara.walton@hlca.co.uk in the first instance.