769P Time limits

Summary

Granting a patent following a substantive search and examination for inventive step may, in certain cases, take a number of years. Therefore, provision is made for the overriding of the time limits for repayment of tax in section 865 in certain circumstances.

Details

(1) Where a company has submitted an application to a Patents Office which would result in a qualifying asset if the patent or protection sought were granted, then the company may chose to make a claim under 769I(2) either in the respect of the accounting period in which the application was submitted or the accounting period in which it was granted.

• (a) If the claim is made in the accounting period in which the application is submitted but that application is subsequently refused then the company shall amend each return in which a deduction under section 769I(5) was claimed, and pay any additional tax and interest due accordingly.
• (b) If the claim is made in the accounting period in which the patent is granted, then a Revenue officer shall amend the assessments for each accounting period in which overall income from a qualifying asset arose, and any tax paid shall be repaid accordingly. No interest arises on payments relating to prior years.

(2) Where a company intends to wait and claim the relief once a patent is granted, then each year when a patent is pending the company must make a ‘protective claim’.

Relevant Date: Finance Act 2019