Along with the headline-grabbing tax implications of yesterday's Budget, which I will leave the more qualified people to discuss, the Chancellor included some plans which may have an impact upon Intellectual Property. In particular, these plans appear relevant to small to medium companies and start-ups that may be intellectual property-rich, but are struggling to secure funding.
First, the Budget announced that the Government will "seek to introduce targeted relief for the cost of goodwill (the amount paid for a business that exceeds the fair value of its individual assets and liabilities) in the acquisition of businesses with eligible intellectual property from April 2019". This may make acquisitions of companies which have already begun leveraging their intellectual property more attractive and increase valuations thereof. It will be interesting to see what is put in place by next April.
The second major Intellectual Property related matter is that "the Intellectual Property Office will support more companies to use their intellectual property to access finance, piloting a new offer to help businesses secure high-quality valuations, and will work with banks to improve their awareness of the opportunities and true credit risk associated with such lending". Again, the devil is in the detail with plans like this, but it is a promising announcement that could make obtaining intellectual property an even more useful proposition for companies seeking funding.
There is an entire supplementary document regarding Intellectual Property published alongside this year's budget which expands upon the above points for anyone interested.
The UK Government appears to be encouraging companies to exploit their intellectual property, whether established or just starting out. The above measures are in addition to the Patent Box tax relief scheme, and the UKIPO Audit Plus Scheme. If your company has yet to dip their feet into the waters of Intellectual Property, consider having a chat with a Patent or Trade Mark Attorney to see where you might be able to seek protection.
• The Intellectual Property Office will support more companies to use their intellectual property to access finance, piloting a new offer to help businesses secure high-quality valuations, and will work with banks to improve their awareness of the opportunities and true credit risk associated with such lending.