Franchise Fees

Is the initial cost for a Franchise deductible?

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Hi Guys,

I recently purchased a Franchise to be part of a PA network.  I registered as self employed and paid the big up front fee and now I'm being told by my new accountant I should have set up a limited ocmpany to get tax back on it.  Is this right?  I've been reading about and I'm getting lost on it.

Thanks in advance

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By mrme89
24th Jun 2017 15:40

Another case of someone spending a large amount of money and then taking advice.

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RLI
By lionofludesch
24th Jun 2017 17:27

Did you get anything tangible for your big up front fee ?

I'm clutching at straws here ....

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Out of my mind
By runningmate
24th Jun 2017 22:59

You need to spell out what you bought for the fee. If the fee covered more than one thing you need to say how much you paid for each thing.
It may be that there is tax relief for the cost of some of the things you bought.
RM

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By DMGbus
25th Jun 2017 19:24

Training costs are the usual problem area with upfront franchise fees. If the training fees are for employees or directors, then tax allowable. So for a Ltd Co tax allowable. For a sole trader or partnership where the training fees relate to the proprietor or a partner HMRC take the view that some "intangible" cost is created that warrants no tax relief.

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