Policy paper

Patent Box – consequential amendment to Patent Box deduction formula

This tax information and impact note details the legislative fix required as a consequence of having more than one rate of Corporation Tax, it will ensure companies with profits of £50,000 or less, which will be paying the Small Profits Rate of Corporation Tax introduced from April 2023, pay the correct preferential rate of Corporation Tax on their Patent Box profits.

• From: HM Revenue & Customs
• Published: 15 March 2023

Documents

Patent Box – Corporation Tax main rate consequential amendment

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Details

The proposed amendment to the formula in section 357A Corporation Taxes Act 2010 aligns the Corporation Tax rates used in the Patent Box formula with the Corporation Tax rate charged on the return. This is achieved by amending the wording in the formula from ‘main rate’ to ‘applicable rate’ of Corporation Tax, and defining applicable rate.

Published 15 March 2023