Tax reliefs available for innovative companies

A summary of tax reliefs available for innovative companies:

contacts and guidance information provided by HM Revenue and Customs

Please note that this information is correct as of 1 April 2022 and could change.

Incentives and Reliefs available:
• Patent Box
• Research and Development Tax credits (R&D), (including Advanced Assurance)
• Creatives Tax Reliefs (Film, Animation, High End TV, Children’s TV, Video Games, Theatre,
Orchestra, and Museums and Galleries)
• Venture Capital Schemes (EIS, SEIS, VCT).

Patent Box
The aim of the Patent Box is to provide an additional incentive for companies to retain and
commercialise existing patents and to develop new innovative patented products.
The Patent Box allows companies to elect to apply a 10 percent rate of corporation tax
from 1 April 2013 to profits attributable to qualifying patents, whether received as a royalty
or embedded in the sales price of products. The regime will also apply to other qualifying
intellectual property rights such as regulatory data protection (also called ‘data exclusivity’),
supplementary protection certificates and plant variety rights.
• Corporation Tax: the Patent Box – GOV.UK
• Guidance CIRD200000 and pages following set out the qualifying criteria
• CIRD275000 includes a flowchart for the computation required.

Research and Development (R&D) tax relief (or credit) is a company tax relief that may reduce
a company’s tax bill or in some instances involve a payment of credit by HMRC to the company.
It is based on the company’s expenditure on R&D.
The company can only claim for R&D tax relief if an R&D project seeks to achieve an advance
in overall knowledge or capability in a field of science or technology through the resolution
of scientific or technological uncertainty and not simply an advance in its own state of
knowledge or capability.
Corporation Tax: Research and Development tax relief – GOV.UK
CIRD80000 and pages following set out the qualifying criteria
CIRD100000 includes a flowchart for the computation required and further information.

Creative industry tax reliefs
These are a group of eight reliefs that allow qualifying companies to claim a larger deduction
for certain expenses. The company will receive a reduction in their Corporation Tax liability, or
in some circumstances a payable tax credit.
• Film Tax Relief
• Animation Tax Relief
• High-end TV Tax Relief
• Children’s TV Tax Relief
• Video Games Tax Relief
• Theatre Tax Relief
• Orchestra Tax relief
• Museums and Galleries Exhibition Tax Relief.
These reliefs are available to companies that fall within the charge to UK Corporation Tax and
that are a qualifying production company; they must be responsible all stages of production.
Creative industry tax reliefs for Corporation Tax – GOV.UK

Venture Capital Schemes
The schemes are intended to incentivise investment in smaller, higher risk, unquoted trading
companies that would otherwise struggle to access finance for growth by providing a range
of income tax and capital gains tax reliefs to individual investors.

Guidance and support
• Enterprise Investment Scheme (EIS)
• Venture Capital Trust (VCT)
• Seed Enterprise Investment Scheme (SEIS).

Methods of contact:
• R&D: Contact details are set out in CIRD80350
• Advance Assurance (R&D). Explanation of this service.

By email
• R&D and Patent Box: [email protected]
• Creatives – [email protected]
• Venture Capital Reliefs: Contact us by email – [email protected]
By phone
• There is a dedicated helpline number 0300 123 3440 and select from the options listed