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.