Corporation Tax Act 2010 section 357VC

Relevant Northern Ireland IP profits: SMEs that are not Northern Ireland employers and large companies

Section 357VC sets out how to determine and calculate relevant Northern Ireland intellectual property (IP) profits for SMEs that qualify by election (rather than by being Northern Ireland employers) and for large companies carrying on a qualifying trade.

• This section applies to companies that are Northern Ireland companies under the SME election condition or the large company condition, and whose trade is a qualifying trade (i.e. not an excluded trade).
• A company only has relevant Northern Ireland IP profits if its IP-related profits, when allocated between Northern Ireland and non-Northern Ireland activities under the relevant rules, result in a net Northern Ireland profit rather than a loss.
• The relevant Northern Ireland IP profits are calculated by applying the fraction NI / P to the company's relevant IP profits, where NI is the portion of IP-related profits forming part of Northern Ireland profits, and P is the total IP-related profits.
• IP-related profits are the trading profits for the accounting period that are attributable to qualifying IP rights held by the company, or to exclusive licences the company holds over qualifying IP rights.