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What are the tax implications of transferring a trademark to a company?
I have been approached by a couple of clients who have asked me whether they can sell to their own companies the registered trademarks they hold personally. Their premise is that if the trademark was held by the company it would be entitled to amortisation in the company accounts and corporation tax relief. I suppose that this plan is in principle similar to that undertaken with goodwill until it was blocked. Further the sale price could be left as a loan so they would have increased directors’ loan accounts.
Are readers aware of clients doing this? From my reading of the situation they would have to be very careful to have any customer relationship value placed on the value of the registered trademark.
Am I overlooking any other tax advantages or disadvantages?
I welcome any thoughts and advice.
Query 18 937– Red.
