I have a client who is a financial advisor. He has recently purchased the business of another IFA. The price was split between the purchase of trail commission and goodwill. I know that the amortisation of goodwill will not be allowable as he doesn't trade as a limited company but what about the purchase of the trail commission which is a substantial element of the purchase price.
Thanks
Alison
Replies (2)
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Capital expenditure, surely?
He has purchased a capital asset- the right to an income stream. Therefore no revenue deduction.