Guide

The Patent Box

The Patent Box enables companies to apply a lower rate of Corporation Tax to profits earned after 1 April 2013 from its patented inventions and certain other innovations.

The Patent Box allows a 10 per cent tax-rate on patent-related profits, as opposed to the standard rate of Corporation Tax of 19 per cent.

Qualifying companies

You can only benefit from the Patent Box if your company:

  • is liable to Corporation Tax
  • makes a profit from exploiting patented inventions

Your company must own or exclusively license-in patents granted by the:

  • UK Intellectual Property Office
  • European Patent Office
  • following European Economic Area countries: Austria, Bulgaria, the Czech Republic, Denmark, Estonia, Finland, Germany, Hungary, Poland, Portugal, Romania, Slovakia and Sweden

Qualifying patent rights

For an intellectual property right to be a 'qualifying right', your company must also meet the development condition in relation to the patent. This means that your company must make a significant contribution to either:

  • the creation or development of the patented invention
  • a product incorporating the patented invention

Find out more about Corporation Tax: the Patent Box.

Note that the Patent Box regime does not apply to profits arising from other intellectual property, such as copyright or trade marks.