Helping you to identify potential tax
reliefs for your Intellectual Property
How does my Video Game qualify?
There are a number of qualifying requirements:
• The video games must be “British”. Its “Britishness” is determined by the British Film Institute who will issue a certificate for video games meeting the criteria for being “British”. They are already issuing similar certificates for other creative industry reliefs.
• The video game is intended for supply
• And at least 25% of core expenditure is incurred
on goods or services that are provided from within the EEA.
Contact us at Cooden Consulting
using the methods below:Email: [email protected]
Phone: 07799 840512
Website: www.coodenconsulting.co.uk
Technology
Tax Reliefs
Can Video Games Tax Relief
integrate with R&D Tax Reliefs
It is certainly possible that in developing your video
game you are seeking a technological advance and
therefore eligible to claim R&D Tax Relief. However,
as the video games tax relief is a form of EU State
Aid, you are unable to claim any other form of EU
State Aid, including certain grants and SME Scheme
R&D Tax Relief.
If you are a larger concern, then certainly until 2016,
you will be able to claim R&D Tax Relief under
the large scheme. From 2016 when the RDEC is
mandatory, the two reliefs are not compatible.
Cooden Consulting Limited
e: [email protected]
Registered in England and Wales, company number 8367248
Cooden Consulting Limited
m: 07799 840512
w: www.coodenconsulting.co.uk
What are Technology Tax Reliefs
and how can they benefit your
business?
These tax reliefs have been introduced and improved
by successive governments from 2000. The most
recent additions have been created in line with the
current government’s pledge to make the UK the
“Innovation Nation”.
They are in order of introduction:
• Research and Development Tax Relief SME Scheme
• Research and Development Tax Relief Large Scheme
• Research and Development Expenditure Credit
• The Patent Box
• Video Games Tax Relief
Research and Development Tax
Relief
Research and Development
Expenditure Credit
Is an alternative to Large Scheme R&D Tax Relief and
will completely replace it from 1 April 2016. It is the
result of extensive consultation with large corporates.
It is designed to generate a revenue stream for
eligible Research and Development and it is
hoped this change may lead to some previously
economically unviable projects being pursued.
The scheme also allows for the credit to be repaid to
the company in the event of a loss.
The Patent Box
Do you own a patent granted by any one of the
following?
• the UK Intellectual Property Office;
• the European Patent Office; or
• the National Patent Office of most countries in the EEA.
The SME scheme was introduced in 2000, the
Large Scheme in 2002. Both schemes are eligible
to companies seeking an advance in science or
technology through the resolution of scientific or
technological uncertainty.
There are a number of qualifying requirements, the
company must:
• Own the patents; or
See our R&D Tax Relief brochure for more details.
• Have undertaken qualifying development; and
• Exclusively license-in the patents;
• Must have made a significant contribution to the creation or the development of the patented invention or a product incorporating the patented invention.
e: [email protected]
m: 07799 840512
How does it work?
Ultimately, the profit derived from the sale of patented
inventions will be taxed at 10%, however, from 1 April
2013, the tax charge will be 18% and will taper by 2%
each year until 2017.
The company’s profit on patented inventions comes
from:
• The sale of patented products, or products containing the patented invention;
• Licensing out;
• Selling patented rights;
• Infringement income; and
• Damages, insurance or other compensation related to patent rights.
The calculation of the profit eligible for Patent Box
is not as simple as the accounting profit and a
number of calculations and adjustments need to be
performed to arrive at the “relevant profit”.
Video Games Tax Relief
If you have been developing a Video Game which has
incurred costs from 1 April 2014, you should read
this!
It has been a long and drawn out process to gain the
necessary approval from the EU, as the generosity
of the scheme, like other “creative industry tax reliefs”
and the Research and Development Tax Relief for
SME companies, makes it a form of EU State Aid.
w: www.coodenconsulting.co.uk