The Innovation Income Deduction, also referred to as “Patent Box”,”IP Box” or “Software Box” is a major fiscal incentive in Belgium for innovative companies: you can gain up to 85% tax reduction on profits realized by a protected innovation!

But my company is not innovative…

Let’s break a myth straight away: every company in every type of industry can be innovative. There is also no limitation on the type of equipment or knowledge to be innovative so potentially everybody can profit from the Innovation Income Deduction. You do not need to be the next social platform on the block or a biotechnology company.
If you made a change in your existing way of working or optimized your processes due to a technical improvement, your innovation could be the basis for applying for the Innovation Income Deduction

Let’s take an example :

A family SME, active in the food sector for decades, recently enlarged its historic production facilities, a process known to all and simple according to the directors of the company, nothing very innovative… but the Calysta experts found that some production parameters were changed when the new facilities were installed, making the process innovative and patentable.
A few weeks and a patent filing later, the company has set up the patent box to cover all of its sales of products made by this process and now enjoys around 100,000 euros in tax savings annually.
“Our investment in the patent box of 10.000 euro, give us an immediate 1000% return on the investment in the first year. Knowing that a granted patent has a lifetime of 20 years, it could be one of the best investment of our company”

How can I benefit from the Innovation Income Deduction?

According to the Belgian law, you can apply for the Innovation Income Deduction when your innovation is protected by a patent or your software by copyright.

But I don’t have a patent!… No problem!

At Calysta we have specialists for every step of the way. We will check with you what are the options. The first step is an inventory of your business, of the various financial costs and income streams. That is why we prefer taking a look on premises ourselves to understand your business and make use of all the possibilities.

How do I know if my software is eligible?

In the case of software, we will work with you to determine which parts of your software qualify for the “software box”. Depending on the situation, it may also be possible to apply for a patent for the software

What is my potential gain?

The Innovation Income Deduction takes the form of a reduction in your corporate tax base.
Innovation Income Deduction = 85% x nexus factor x (Turnover related to the innovation – own R&D expenses related to the innovation)
This seems to be complex but Calysta has all the expertise and will make it simple for you. Do you want to know the benefit for your company? Call us and we will setup a free meeting to check if the patent box is profitable for you.
Calysta’s expertise can create a lot of value for your company.

E-mail: anthony.lardinoit@calysta.eu

Phone: +32 (0)2 892 8088

• I don’t have a patent. How much will this cost me?
  • To file a patent in Belgium, you should think of an average of 5,000-10,000 euro (excl. VAT). Note: Calysta can guide SMEs in obtaining subsidies
• I already have a patent, can I use this?
  • Yes, as long as it has not generated any revenue before 2007.
• Do I need a granted patent?
  • No, it is possible to apply for the innovation income deduction based on a patent application.
• How much does it cost to process the file for the innovation deduction?
  • The entire handling of the file at Calysta costs an average of 8,000-10,000 euros (excl. VAT). Note: Calysta can guide SMEs in obtaining subsidies
• What if I don’t make enough profit to pay taxes yet?
  • The innovation deduction can be carried over until you make a profit.
• Do I have to perform the research and development myself?
  • No, but if the R&D is performed by a company within the same group, it will affect the Nexus ratio
• Do I have to request a ruling?
  • A tax ruling can be requested from the Office for Advance Tax Rulings. However, in most cases we don’t have to do this, as it is quite expensive and not necessary for simple files.
• What other intellectual property rights qualify for the innovation deduction income?
  • The innovation income deduction can also be applied for:
    • supplementary protection certificate;
    • plant breeders’ rights;
    • orphan drugs;
    • data and/or market exclusivity for plant protection products, medicines for human or animal use.