Published on 08 Nov 12
by NATIONAL DIVISION, THE TAX INSTITUTE
Intellectual property (IP) and goodwill are the life blood of a modern growing enterprise. Think of the business names, logos, and trademarks which are avidly protected by international corporations because they are the back bone of their enterprise value. It is easy to confuse the value of IP and goodwill when a business is sold. This paper identifies the essence of these assets and the taxation consequences which follow when dealing with them.
This paper covers:
- identifying goodwill and distinguishing it from IP
- the source of goodwill in intangible assets
- structures for holding IP
- interplay with R&D concessions
- Capital gains tax issues: determining the appropriate cost base, termination value and the interaction with Div 40
- goodwill licensing and franchisees’ goodwill (Just Jeans issues)
- creation of IP outside of Australia (original copyright)
- TR 2008/7 on royalty withholding tax and assignment of copyright.
Domenic Carbone CTA
Domenic has been a full-time lecturer, primarily in taxation law, since joining the University of Adelaide in 1992. He is also a Barrister and Solicitor and carries on a tax and legal practice on a part-time basis, and has been a consulting tax adviser to legal and accounting firms. Domenic’s ackground in taxation law extends beyond academia and includes experience in both the private and public sectors. Prior to his appointment as a lecturer,he was a tax manager with a then “Big 8” accounting firm where he was mainly involved in the tax consulting, tax audit and indirect tax areas. Domenic had previously worked for several years in the
Australian Taxation Office where he held a number of positions,including the Legal Officer of the Adelaide branch office of the ATO and Senior Appeals and Review Officer. He also spent some time as Personal Assistant to the Deputy Commissioner of Taxation, the then head of the Adelaide branch office. Current at 06 August 2012
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