HM Revenue & Customs (HMRC) has released updated statistics for the Patent Box tax relief scheme, revealing that the total value of claims reached £1.98 billion during the 2023-24 financial year.
The figures, published in September 2026, show that approximately 1,650 companies elected into the regime during that period. Provisional estimates for the following 2024-25 financial year suggest the cost to the Exchequer is set to rise further, potentially reaching £2.4 billion.
The Patent Box is a tax incentive designed to encourage companies to keep and commercialise intellectual property in the UK. It allows businesses to apply a reduced 10% rate of Corporation Tax to profits earned from its patented inventions, a significant reduction from the current main rate of 25%.
Large companies dominate relief value
While the scheme is open to businesses of all sizes, the data highlights a significant concentration of the relief’s value among the UK’s largest firms. Large companies represented just 28% of the total number of claimants but accounted for 95% of the £1.98 billion in relief granted.
The manufacturing sector remains the primary beneficiary of the policy. According to the data, manufacturing firms secured 41% of the total relief value, reflecting the industry’s reliance on patented technology and high-value research and development.
Regional data confirms that the South East of England continues to be a hub for innovation under the scheme. Approximately 16% of all UK companies successfully claiming Patent Box relief are based in the South East.
Eligibility and deadlines
To benefit from the 10% tax rate, companies must hold qualifying intellectual property. This includes patents granted by the UK Intellectual Property Office (IPO) or the European Patent Office (EPO). The relief also applies to certain other rights, such as medicinal or botanic product rights.
The rise in the value of the relief is partly attributed to the 2023 increase in the main rate of Corporation Tax from 19% to 25%. This change widened the gap between the standard tax rate and the Patent Box rate, making the incentive more valuable for profitable companies.
Businesses considering a claim are reminded of strict procedural timelines. A company must elect into the Patent Box regime in writing within two years of the end of the accounting period in which the relevant profits were earned. Failure to meet this window typically results in the loss of the relief for that period.
