Weighing up your options: Trademark ownership possibilities
There isn’t necessarily a correct answer, it is subjective to every individual’s needs and situation, that is why we recommend weighing up your pros and cons and following what fits best.
The pros & cons of registering a trademark in your individual name
Pros:
Personal control: Registering in your own name means you own and control the trademark directly, separate from any business. This can help if you expect your business structure to change in the future.
Simpler process: If you are a sole trader or freelancer, registering in your name can make things easier, as you will not need extra company paperwork.
Continuity: The trademark stays with you, even if your business changes or closes.
Cons:
Personal liability: If there are legal problems linked to the trademark, you could be personally responsible.
Tax: Any income from the trademark may be taxed as personal income, which can mean higher rates than company tax.
Business Continuity Risks: Transferring the trademark in the event of a business sale or succession can be more complicated and may affect the valuation of the business.
The pros & cons of registering a trademark in your company name
Pros:
Business asset: Registering the trademark in the company’s name makes it part of the business. This can strengthen your intellectual property and add value to the company.
Limited liability: Legal issues with the trademark are the company’s responsibility, not yours personally.
Tax: Income from the trademark is taxed as company income, which is often at a lower rate than personal tax.
Transfer: If you sell the business, transferring the trademark is usually more straightforward if it is in the company’s name.
Cons:
Dependent Ownership: If the company closes or goes bankrupt, the trademark could be lost or caught up in legal issues unless it is transferred out first.
Management challenges: Decisions about the trademark may be subject to company governance, limiting individual control.
Administration: Registering in the company’s name means you need to keep the company records and filings up to date, which can add extra work.
Making your decision…
When choosing how to register your trademark, consider your business goals and tax position.
For instance, if you are building a personal brand or working alone, registering in your own name may suit you.
If you plan to grow or work with others, registering in the company’s name could make things easier; tax rules differ, so it is worth speaking to a tax adviser.
If you expect to sell the business or transfer assets, company registration usually simplifies the process.
Both options have pros and cons, remember the best choice depends on your situation.
Talk to Orwins for help with trademark ownership legality
For advice tailored to your needs, speak to a legal or IP professional at Orwins, we can help you protect your intellectual property and support your goals.
