Im doing an assignment for self assessment tax and one of the questions deals with adding back non-allowable expenses. Are patent royalties an allowed expense ? I cant seem to get an answer on the HMRC site. At the top of the question it says patent royalties (gross), in the style of a p+l account, then patent royalties are also in the expenses>
Two types of royalties, Patent and Copyright. Both are allowable expenses.
Copyright royalties are paid gross
Patent royalties are paid net of basic rate tax
Even ACCA paper P6 doesn't test collection of tax on patent royalties. Which body are you studying with Suzie?
Actually, best money that you can possibly spend on tax studies is the Kaplan ACCA complete text for paper P6 (I buy that one every year) and if you want to learn tax quickly the BPP i-learn course on a DVD for ACCA paper P6.
They're advanced level studies but with tax that just means that there are extra bits to the skills level papers rather than anything particularly different so you might as well get the big book (its A4 size and about 6 cm thick).
Current versions are FA11. The new versions come out around October time.
HTH,
Shaun.
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Shaun
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