‘City could learn from manufacturers about accessing innovation funds’
1 Oct 2018
Financial and insurance companies should follow the example of manufacturers in accessing funds for innovation, says a leading intellectual property expert.
Michael Jaeger, partner and patent lawyer for Withers & Rogers, said manufacturing has led the way in using the Government’s five-year-old Patent Box scheme to invest in research and development.
“According to HMRC’s data, manufacturers are making the most claims, followed by businesses in wholesale, retail and repair, but some other sectors are making fewer claims that we might expect to see,” he commented.
“For example, only five companies in the financial and insurance sector claimed Patent Box relief in 2015-2016, which is disappointingly low given London’s reputation for fintech innovation. Businesses in other sectors, such as construction and transport, and clean tech may also be missing out on relief.”
New data released by HM Revenue & Customs reveals that 1,025 UK companies claimed £942.5 million in relief under the Patent Box regime in the 2016-17 financial year.
This is an increase on the £754.3 million recorded in the previous tax year – equivalent to a rise of 25%. However, says Jaeger, some of the growth may be accounted for by the phased increase in the amount of relief that businesses can claim.
Yet, as the latest figures for 2016-17 are incomplete, the overall amount of relief claimed and the total number of claimants could prove to be still greater.
“While it is positive that the value of claims rose by 25% in 2016-17, the volume of claims is still disappointing, particularly when you compare it with the volume of claims for R&D tax relief,” added Jaeger.
He said that, with the Autumn Budget nearing, the Chancellor must reassure businesses that Patent Box will continue and encourage uptake. This in turn would create greater certainty to businesses sponsoring innovation and seeking to profit from their patented inventions in the UK.