Tangible Assets are those assets that have physical existence. This implies that these assets can be seen or touched. For example, Plant, Furniture, Loose Tools, etc. Intangible Assets are those assets that do not have any physical existence. It implies that these assets cannot be seen or touched. For example, Goodwill, Patents, Trademarks, etc. The following are some points of difference between Tangible and Intangible Assets.
Difference between Tangible and Intangible Assets
| Basis of Difference | Tangible Assets | Intangible Assets |
|---|---|---|
| Existence | These assets have physical existence which can be seen or touched. | These assets do not have any physical existence which cannot be seen or touched. |
| Nature | These can either be fixed or current assets. | These are generally fixed assets. |
| Reduction | The reduction in the value of these assets is considered as depreciation. | The reduction in the value of these assets is considered amortization. |
| Risk | These assets are exposed to the risk of loss or destruction by fire or theft. | These assets are not exposed to the risk of loss or destruction by fire or theft. |
| Security | These assets can be accepted as security against a loan taken. | These assets cannot be accepted as security against the loan taken. |
| Examples | Land and Building, Machinery, Furniture, etc. | Patents, Goodwill, Trade Marks, etc. |
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