The legislation is framed in terms of the agreement for the
transfer, so if the agreement provides for later developments in IP
(sometimes called “improvement IP”) to go to the spin-
out then these will also be covered.
However, if unconnected IP is transferred into the spin-out
later, then although relief may be available for this element if
other criteria are satisfied, an Income Tax charge could arise if
additional shares were issued, the value of which had been enhanced
by other elements, e.g. previous funding injections.
