HMRC Report shows Patent Box Relief claimed increased by 25%

HMRC has recently released its annual statement on the uptake of Patent Box relief, with claims made to date showing an increase in relief claimed of almost 25%, from £754m (2015/16) to £942m (2016/17). This is expected to increase further as claims for 2016/2017 are finalised.

It's interesting to note that whilst only 25% of claimants are large companies, they account for 96% of the relief claimed. Companies in the manufacturing sector are the greatest beneficiaries. Over 100 companies in Yorkshire and the Humber claimed £54m of relief in 2016/2017.

The aim of the Patent Box regime is to incentivise innovative companies to increase the number of patents developed and commercialised in the UK. The relief is still in its early days, with 2016/17 only being the third year for which data is available. The difference to R&D claims is that once a qualifying patent has been obtained, then provided qualifying income is derived from the patent, the relief applies year after year for as long as the patent is valid.

This increase in the amount of relief claimed bears out our experience with more and more patent box claims being submitted by our clients. Companies are put off as they think claiming will be too difficult, and to be honest, the regime isn’t straightforward – however, the Radius team at Shorts are able to confidently and efficiently calculate the benefit for your company and we would encourage you to discuss this with us if you have any patents, or believe you have any patentable technology.