The future of ‘Patent Boxes’ – the OECD’s adoption of a joint proposal by UK and Germany

In a written ministerial statement issued today, the Financial Secretary to the Treasury, Mr David Gauke, confirmed that the Organisation for Economic Cooperation and Development (OECD) has adopted all of the proposals put forward by the UK and Germany to resolve uncertainty over the future of preferential intangibles regimes, such as the UK’s “Patent Box”.

Carmen Aquerreta, tax partner and head of the Deloitte Patent Box team, comments:

“This is good news for the UK.  We’re another step closer to finalising the future direction of the UK’s innovation tax regime, and companies that have been delaying decisions can move forward. We have an excellent track record of investing in R&D.  Many UK groups have significant historic R&D spends which will translate into substantial future patent box claims. 

“Detailed rules on tracking and tracing R&D costs still need to be agreed.  We expect the OECD to consult on the detailed rules, and UK business should be prepared to make its views known.  Now is the time to start thinking about how to make the nexus method work in practice.”