Cutting the rate of Corporation Tax by around half for companies who patent their inventions, is not enough of an incentive to encourage UK innovation.
London, UK (PRWEB UK) 11 April 2013
As the Patent Box scheme launches, analysis carried out by Patent Box specialists Patentise found that the two main aims of the Patent Box – encouraging more UK innovation, and making the UK more attractive for basing R&D – had not been achieved.
The study based upon results of a Computing online poll of more than 1,000 technology companies carried out for Patentise, found almost eight out of ten companies believe the 10% rate of Corporate Tax for patent holders provided by the Patent Box scheme does not provide enough encouragement for companies to retain high tech jobs in the UK.
The results of the poll also found that just 6% of companies planned to develop new patentable products in order to take advantage of the lower tax rate on profits attributed to patents.
Key findings of the poll:
- 78% of respondents said the Patent Box’s 10% rate of Corporation Tax did not provide enough of an incentive for companies to retain high tech jobs in the UK;
- Only 6% are actively looking to develop new products in order to increase their patent portfolio and avail themselves of the lower tax rate;
- 12% said they need to have a better understanding of what the Patent Box means to them.
Analysing the data, Patentise expert and solicitor Gary Moss said: “What the results of this poll show is that despite the government’s attempts to make the UK a more attractive destination in which original ideas are developed and exploited, cutting the rate of Corporation Tax by around half for companies who patent their inventions, is not enough of an incentive to encourage UK innovation.”
The Patent Box provides favourable Corporation Tax rates for profits derived from the exploitation of patents. The rate is 10% as opposed to the normal rate (currently 20-24%). The Government has enacted this incentive specifically to encourage innovation and to persuade companies to retain high value jobs within the UK, rather than base their R&D in countries with more favourable tax rates.
Patentise is a unique proprietary service from EIP, one of the fastest-growing IP partnerships in the UK. EIP’s Patentise team provides an all-round service dealing with all aspects of IP, and includes intellectual property attorneys and solicitors, patent and trademark prosecutors, IP litigators, patent searchers and IP strategists.
The Patentise team specialises in the Patent Box. Partners Matt Lawman and James Seymour are both highly experienced patent attorneys and IP strategists with considerable in-house experience, and Gary Moss is one of the UK’s leading IP litigators. They have followed the Patent Box proposals from the outset and made observations and comments on the legislation as it was being formulated.
EIP was one of the first IP firms to recognise the full extent of the potential importance of the Patent Box for companies, and its Patentise service, supported by senior members of EIP’s professional staff, offers companies the most comprehensive approach to preparing for the new scheme.