Finance Act 2012 (introduced Patent Box)
What this means for your business
- Enforced by
- HMRC
- Applies to
- United Kingdom
- On this page
- 5 compliance obligations, 1 practical guide
What you must do
5 compliance obligations under this legislation — 1 can result in imprisonment.
Payments and fees 3
Calculate and pay duty on hydrocarbon products using pre‑2011 rates for Aug‑Dec 2012
If your business deals with fuels or other products that attract duty under the Hydrocarbon Oils Duty Act, you must apply the old duty rates (as if the Finance Act 2011 changes never happened) for any duty‑charged product dated between 1 August 2012 and 31 December 2012. This ensures your tax return reflects the correct amount of duty for that period.
Pay air passenger duty on each UK flight
If you run an airline that operates flights into, out of or within the UK, you must pay an air passenger duty for every passenger boarding those flights. The tax is due to HMRC and is calculated when the flight departs or arrives.
Pay Machine Games Duty to HMRC
If your business runs amusement or other machine games, you now have to pay an excise duty called Machine Games Duty instead of the old licence duty. You must calculate the duty on each machine and pay it to HMRC according to the rates set in Schedule 24.
Offences and prohibitions 1
Conceal or destroy documents after a conduct notice
2 years imprisonmentIf, after HMRC has issued a conduct notice (or warned that one will be issued), you hide, destroy or otherwise dispose of any document that HMRC could reasonably ask for, you commit a criminal offence. On conviction you face up to two years’ imprisonment and/or an unlimited fine.
Reporting and filing 1
Submit written clearance application and respond to HMRC within 30 days
If you want HMRC to approve an insurance business transfer under the Patent Box regime, you must send a written application with all required details. HMRC can ask for more information, and you must provide it within 30 days (or a longer period they allow). Failure to reply on time means HMRC can stop considering your request.
Penalties for non-compliance
1 penalty under this legislation. 1 can result in imprisonment. 1 carry an unlimited fine.
Conceal or destroy documents after a conduct notice
Unlimited fine and/or 2 years imprisonment
Practical guidance
Our guides explain how to comply with the requirements above.
Sections and provisions
274 classified provisions from this legislation.
Duties 4
Powers 17
- Schedule 17 Part 2: transitional provision
- Schedule 24 Machine games duty
- s.27 Election to accelerate receipts under s.26(4)
- s.37 Roll-over relief
- s.98 Commercial allocation
- s.101 Commercial allocation for disposals not wholly dealt with by section 100
- s.108 Meaning of “the closing deferred policyholder tax balance” etc
- s.115 Commercial allocation of accounting profit or loss and tax adjustments
- s.137 Meaning of “the long-term business fixed capital”
- s.142 Power to amend Part 2 etc
- s.143 Power to amend definition of “insurance business transfer scheme” etc
- s.162 Section 160: statutory declarations
- s.163 Directions given to old societies
- s.168 Withdrawal of qualifying status
- s.223 Tax agents: dishonest conduct
- s.226 New tax on ownership of high-value residential properties or dwellings
- Schedule 27 Anti-forestalling charge to VAT
Definitions 59
- Schedule 1 High income child benefit charge
- Schedule 11 Expenditure on plant and machinery for use in designated assisted areas
- Schedule 13 Employer asset-backed pension contributions etc
- Schedule 20 Controlled foreign companies and foreign permanent establishments
- Schedule 25 Remote gambling: double taxation relief
- s.26 Abolition of relief for equalisation reserves: general insurers equivalent reserve
- s.56 Meaning of “life assurance business”
- s.57 Meaning of “basic life assurance and general annuity business”
- s.58 Section 57: meaning of “pension business”
- s.59 Section 57: meaning of “child trust fund business” child trust fund policy
- s.60 Section 57: meaning of “individual savings account business” individual savings account policy
- s.61 Section 57: meaning of “overseas life assurance business”
- s.62 Section 57: meaning of “protection business”
- s.63 Meaning of “long-term business” and “PHI business” long-term business PHI business
- s.64 Meaning of “contract of insurance” and “contract of long-term insurance”
- s.65 Meaning of “insurance company”
- s.70 Rules for calculating I - E profit or excess BLAGAB expenses
- s.73 The I - E basis
- s.74 Meaning of “income”
- s.75 Meaning of “BLAGAB chargeable gains” etc
- ... and 39 more definitions
Exemptions 38
- s.2 Basic rate limit for 2012-13
- s.3 Personal allowance for 2012-13 for those aged under 65
- s.13 Champions League final 2013
- Schedule 14 Gifts to the nation
- s.25 Corporate members of Lloyd's: stop-loss insurance and quota share contracts
- s.29 Transfer of whole or part of the business
- s.41 Plant and machinery: restricting exception for manufacturers and suppliers
- s.67 Exception where BLAGAB small part of long-term business
- s.71 Charge to tax on profits of non-BLAGAB long-term business
- s.87 Losses from property businesses where land held for long-term business
- s.92 Certain BLAGAB trading receipts to count as deemed I - E receipts
- s.111 Dividends and other distributions
- s.112 Index-linked gilt-edged securities
- s.116 UK life insurance companies
- s.117 Overseas life insurance companies: rule corresponding to s.116
- s.118 Transfers of business and transfers within a group
- s.119 UK life insurance companies
- s.120 Overseas life insurance companies: rule corresponding to s.119
- s.127 No relief against policyholders' share of I - E profit
- s.129 Intra-group transfers and demutualisation
- ... and 18 more exemptions