The revaluation of intangible assets

The 2014 Stability Law has dealt with the revaluation of companies’ assets including intangible assets such as trademarks, patents and know how. Often intangible assets, even if maintaining an economic value, are not accounted since they are already amortized. As a consequence, the revaluation, if possible, is an important instrument of optimization of the fiscal and financial management. The main advantages of the revaluation of company assets are represented by the surplus that can be generated and therefore its consequent imputation to equity that will emerge in the balance sheet. A higher valuation of the company´s assets can generate positive effects in its financing, improving its credit quality and terms. It is important to note that, in the light of the new discipline on banks regulatory capital, , the cost of the credit is influenced also by the company creditworthiness.. The assessment of the likelihood that a borrower will default on their debt obligations, known as credit rating, is becoming a crucial indicator that will contribute to define the availability of the banks to grant credit and its terms and conditions. It is evident that the rating will reflect the risk perceived by the bank on the capacity of the company to repay the debt contracted. In the case of intellectual property rights, registered in the balance sheet for relatively modest sums, it will result definitely relevant to make the highest economic value attributable to those assets emerge in order to improve the levels of capitalization of the company, thanks to the establishment of revaluation reserves. In this way, the rating attributed by the banks to the company will be positively influenced, with not insignificant economic and financial benefits. The financing opportunities that lie ahead for the company thanks to the exploitation of industrial property rights are multiple. For example, the so-called leaseback on trademarks is becoming more common; in brief, it consists in the possibility of financing by selling to a financial institution, following a specialized valuation of the relative value, the own trademarks, generating liquidity and leasing it back at the same time. Another important aspect why the revaluation of the company assets is convenient is linked to the eventual intention to make a future assignment of the asset revaluated. In this way, taxable capital gains are avoided according to the ordinary corporate tax (IRES), income tax (IRPEF) and regional income tax (IRAP) rates, paying instead a substitutive tax lower than the ordinary withdrawal. The revaluation is made through the payment on the greatest values of a substitutive value in the measure of the 16% on the depreciable assets, material and immaterial, and of the 12% on the rest of the assets. The payment of the substitutive taxes is made in three equal installments without interest and the payment of the first installment is made in the fiscal year in connection with the revaluation. The fiscal benefit of the procedure of revaluation will be from the third fiscal year subsequent to the revaluation. In order to proceed with such a revaluation you can rely on the expert report of a qualified technician, who will identify the value of the intangibles (for example trademarks and patents) that the company holds. In the light of the above, the revaluation of the company assets is to be considered an important instrument of optimization of the fiscal and financial management. If you are interested in reading more about this topic, you can write to busoni@turinigroup.com