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Is a Franchise fee tax allowable?

Is a Franchise fee tax allowable?

Hello my boss just came into my room and asked whether paying a franchise fee is tax allowable?

I don't know of any specifics but any information or a pointer of where to look would be much appreciated. (I'm thinking it may be treated similar to a lease premium?)

Thanks in advance


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25th Jan 2013 10:04


Are you a Company? If so, consider the Intangible Fixed Assets Regime 2002.

If you are not, it is unlikely you will be able to claim (most) of the Franchise fee.

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By DMGbus
25th Jan 2013 18:57

Analyse the fee as to what it buys / pays for.

Training - for a new activity / trade : disallowable in a sole trader or partership.  But allowable in a Ltd Co.   Same for "Goodwill" or right to use the franchise name (intangible).

Sometimes there might be an element of other costs included in the fee - for example see if there's initial supplies of marketing materials, consumables, operating manuals or equipment.   It might include a few weeks "marketing support" which is tax allowable.  Tricky thing can be evaluating these allowable vs the non-allowable training costs or (sort of)  "goodwill" (intangible) elements.


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