Selling and licensing your IP

One of the benefits of owning intellectual property (IP) is the ability to assign (sell) or license rights. This can generate revenue during the registration period. By registering and protecting your IP in this period, you will be able to increase its sale value; much like traditional investments.

Assigning (selling) your IP rights to another company is relatively easy. Licensing needs agreement on conditions of use between both parties. Licensed rights can be exclusive or non-exclusive, and gives the licensee the ability to use (but not own) the copyright, patent, trade mark or design.

Payments for use of IP can be in the form of royalties or one-off payments, with the value of the rights placed into a commercial agreement.

Tax Implications

IP is treated as an asset for tax purposes. This means that if you generate revenue from it, there may be tax implications. Taxes that may be affected are:

  • income tax
  • Capital Gains Tax
  • withholding taxes, both locally and internationally
  • Goods and Services Tax (GST)
  • stamp duty.

If you're considering selling or licensing your IP assets, consult an IP professional or the Australian Taxation Office for advice.

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