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Home / Simons-Taxes /Business tax /Part B5 Specific trades and activities /Division B5.3 Intellectual property /Intellectual property—patents / B5.341 Intellectual property—patents—employee awards
Commentary

B5.341 Intellectual property—patents—employee awards

Business tax

In normal circumstances an inventor who is employed by a company to invent would be rewarded by a salary, possibly with bonuses, commissions or other benefits, all of which would be chargeable under the employment income rules of ITEPA 2003.

However, an employee inventor may apply to the court under the Patents Act 1977, s 40, for an additional payment to be made to him by the employer where his work has given rise to a patent of outstanding benefit to the employer. The court may award an additional payment to the employee if it considers it just to do so, bearing in mind the remuneration already paid to the employee1.

It is likely that such an award would take the form of a lump sum payment. In anticipation of an award by the court, the employer might make such a lump sum payment to the employee over and above

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