Taxes Consolidation Act 1997 section 769P

Time limits

Section 769P provides options for claiming knowledge development box (KDB) relief where a patent application is pending, including the ability to override the normal four-year time limit for tax repayments.

• A company may claim KDB relief either in the accounting period in which a patent application is submitted or in the accounting period in which the patent is granted.
• If relief is claimed in the year of application and the patent is subsequently refused (in whole or in part), the company must amend its returns for all affected periods and pay any additional tax due together with interest.
• If the company chooses to wait until the patent is granted, it must make a protective claim in its return for each year in which the patent is pending.
• Any repayment of tax on grant of the patent cannot exceed the total of the protective claims previously submitted.