The new Patent Box regime comes into effect – albeit with the full benefit phased in over five years – from April 2013. That might seem some way off now but there’s a lot of things an efficient tax director can start doing now to get ready for the new regime.

Like a growing number of incentives, a lot of ‘non-tax’ information will need to be collated before a claim can be made. For example, tax directors will need to:

  • obtain information identifying the qualifying patents that the company holds (including by way of exclusive licence) and check that the requirements of the legislation are met.
  • obtain information in respect of R&D expenditure for the four years prior to the company electing into the regime.
  • consider the definition of a ‘group’ for patent box purposes, which is much broader than for other CT purposes and may hold some traps for the unwary.
  • consider whether the company will have Patent Box profits or losses initially. Companies with patent box losses may be better off delaying entry to the regime.

My article on this issue (originally published in Tax Journal and reproduced with their permission) has more information.