Goodwill

Goodwill

Didn't find your answer?

A client purchases a business including the property from which the business operates. Business is bought in joint names, ie a partnership. Client wants to create a Ltd Company to run the business, and extract profit through low salary / dividends. (only lower tax paying partner will be involved in running business) The limited company will pay rent to the partnership for the property, the partnership remains the legal owner of the property. My question is what do we do with the goodwill paid for the business. At the moment the goodwill will be owned by the partnership, is this the right place to have the goodwill ? Should goodwill be sold to the Limited Company ?

Replies (2)

Please login or register to join the discussion.

avatar
By blok
15th Dec 2010 16:41

.

Its not optional!!!

I dont think you understand the basics of goodwill.

You need to seek expert advice.  If you need to ask this type of question you are surely going to cost the client some money somewhere along the process.

 

Thanks (0)
avatar
By tomzjalic
15th Dec 2010 19:14

..

 If the purchase agreement is in the names of the partners then it has to stay in the partnership

Thanks (0)