Patent Box

What is Patent Box?

The Patent Box Scheme aims to create a competitive tax environment for companies to develop and exploit patents in the UK, supporting business investment and growth. It is a key element in the Governments’ Growth Plan to provide additional incentives in order to develop, commercialise and retain the best technologies and inventions in the UK.

Where a patent has been granted, even where the patented element is minor, all profits arising from product revenues should qualify providing a written election requesting clearance to claim is made to HMRC.

If your business has any pending or granted patents, you could be eligible for a significant tax saving, whereby profits from the patented product (or process) will qualify for a reduced corporation tax rate of just 10%.

And whilst a granted patent is required before any benefit can be claimed, seeking election whilst an application is ‘pending’ means the reduced tax rate can be applied retrospectively to profits generated during the ‘pending’ period since the election was made, up to a maximum of six historic accounting periods.

Granted Patents
  • Audit of patent portfolio
  • Make a retrospective claim for the last two financial years
  • Patent Box scheme election
  • Make a PB claim
  • Receive your tax benefit within 42 days of claim submission
Pending Patents
  • Patent Box Scheme election
  • Audit of patent portfolio
  • Track patent income
  • Make a PB claim
  • Benefit will be received when the patent has been granted
I do not have any patents
  • Audit conducted by our IP team
  • Patent attorney to advise on likelihood of successful patent
  • Prepare patent application
  • Submit and manage ongoing IP
  • Make a PB claim
  • Benefit will be received when the patent has been granted

Qualifying IP Income

  • Worldwide income from the sale of product which incorporates a patent, including spare parts

  • License fees or royalties from qualifying IP

  • Any compensation income or damages from the infringement of owned rights

  • The sale and disposal of qualifying IP and rights

What is it worth?

The specialist IP team at Innovation Tax will work with you to assess your entitlement and claim the tax relief on your behalf by;


Total amount of paid
out since inception of
the scheme in 2013


Total amount of claims
made since inception of the
scheme in 2013


Total amount of benefit
claimed in the 16-17 period


Current average claim
for SME’s


Current average claim for
Large Companies

The full Patent Box Statistics are released each year in September and can be viewed on the following link:

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