Corporation Tax Act 2010 section 357VD

Relevant IP losses

Section 357VD explains how relevant IP losses (set-off provisions) interact with the Northern Ireland Patent Box rules, ensuring that where losses reduce Patent Box profits under the main rules, the same reduction is reflected in the Northern Ireland calculation.

• Three types of IP loss set-off can reduce Patent Box profits: sideways set-off across trades, group relief allocation, and carry-forward of losses
• Where any of these set-off provisions prevents the Patent Box election from applying to an amount of relevant IP profits, the Northern Ireland Patent Box calculation is reduced by the same amount
• The effect is that the main Patent Box loss rules take priority, and the Northern Ireland rules simply work with whatever reduced profit figure remains
• No separate adjustment is needed for Northern Ireland purposes because the reduction flows through automatically