Protecting ideas and inventions through patents has always provided important legal rights to businesses but the Patent Box Scheme, which came into effect earlier this year, now means that companies can also benefit from a number of tax incentives.
Announced in the 2012 Budget as one of the Government’s key measures for businesses, the Patent Box was developed to encourage companies to invest in and successfully commercialise research and development.
The scheme came into effect in April and allows businesses to reduce their Corporation Tax liabilities on profits generated through patented inventions. To qualify for the scheme a company must own, a granted patent, and must have made a significant contribution to the development of the invention.Companies can also qualify for the scheme if they hold an exclusive license to sell a patented product or invention.
Some industry experts predict that the provisions made through the Patent Box will result in a surge of patent applications as companies look towards making savings on their tax burdens. However, as a patent cannot be included in the scheme . Since it can take several years for a patent application to mature into a granted patent, it might be worth checking patents already owned by your business; it is possible they might cover products you are selling that you presently believe are not protected by a patent.
Patent Attorneys can review the patent portfolio owned by your business and advise whether a product is eligible for the Patent Box scheme through your existing patents as well as advising whether new patent applications are required.
It is not uncommon for businesses to file multiple patent applications relating to similar ideas or inventions. In this way different aspects of a product or process as can be protected as the invention continues to develop, making it more difficult for the idea to be copied by rivals.
This can mean that, even in cases where a patent application has been filed and awaiting examination, the product may already be protected under previously granted patents, allowing your business to benefit from the Patent Box provisions.
Although the tax incentives offered through the Patent Box scheme may be attractive, it is essential that the most appropriate forms of protection are put in place. Working with a patent attorney can help to ensure that your products, processes, services and brands receive the right form of protection both in the UK and international markets.
Please note that the content of this article is provided for general information purposes and does not constitute legal advice and we always recommend consulting a qualified patent attorney to discuss specific intellectual property matters.
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