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Tax Consequences of Using Intellectual Property In the International Arena

Plan Now Or Watch Your IP Tax Costs Spiral Upward

Around the globe governments in developed countries everywhere have recognized this fact:  The future is knowledge-based.  Even now little of a company’s value resides in machinery, tools, or factories.  It’s the patents and copyrights, the trademarks, trade secrets, and software that generate profits now.  It’s the synergies that arise between skilled, highly educated workers that know what they’re doing and how to do it that make one company a success while others struggle.

In the good old days, a company could simply buy a new factory in an undeveloped country then move its key know-how, it’s patents and trade secrets, right across the border without the taxman blinking an eye.  That time has passed.  Try it today and you’ll face a plethora of barriers, taxes, and fees intended to keep you right where you are.

In the May/June 2013 issue of Valuation Strategies I published an article describing the headaches this new world order can create for a company that neglected the tax consequences of its expansion into overseas markets.  I post here the original, unedited version:  Cleaning Up the Toxic IP Spill.

I hope you find it helpful.

 

Tom


This article is for informational purposes only and does not constitute legal advice.  You should consult a qualified attorney before taking any action.