Relief for investing in IP

Mon 29 Oct 2018

The Chancellor announced a number of changes to the intangible assets regime to make the UK a more attractive place to invest in intellectual property. The new rules should come into force in the Finance Bill 2018-2019. The changes to the intellectual property regime are good news as these should go some way to helping achieve this aim, by encouraging inward investment into the UK in technological advanced businesses.

The first of the changes will result in a form of acquisition relief where companies are acquired which have goodwill relating to intellectual property. The details of how this relief will operate is yet to be released so it remains to be seen how generous the relief will be.

The second change will remove degrouping charges in certain circumstances where intellectual property leaves the group. This will bring the intangibles regime in line with the tangible assets regime and should allow for reduced tax costs when transferring intellectual property leaves the group. These rules should apply to transactions from 7 November 2018 onwards.

Combined, the measures announced in the 2018 Budget make the UK a more attractive place to invest in intellectual property, whether for domestic or international businesses which can only be a good thing.