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Goodwill Amortisation and CT600

Goodwill Amortisation and CT600

We own a small retail business and post office that we purchased through our Ltd company and have been writing off the goodwill over 5 years because of uncertainty of the future of the Post Office and offsetting this against the P&L and therefore reducing our corporation tax bill.

My accountant has said that from 2011 amortisation of intangible assets (Goodwill) can no longer be treated this way and has to be added back into the profit/loss value for the purpose of calculating corporation tax, he stated that it is now treated as "Loses on Disposal of Assets"

I am not an accountant but I cannot find anything on HMRC site that says Goodwill Amortisation has to be treated differently so am hoping some one can provide some guidance for me as I have a feeling he is not providing me with the correct information but of course I could be wrong.




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By Ford
21st Dec 2012 11:03

The rules have not changed but there could be more to your situation than is outlined above, but on the face of it you are not wrong. Feel free to PM me if you would like further advice.


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21st Dec 2012 12:22

Spooked by property-related goodwill?

The rules haven't changed; what happened in 2011 was that HMRC published some 'guidance' on how to deal with goodwill in trade-related properties - and a post office will almost certainly be regarded as a trade-related property, as the location will have some impact on the success/otherwise of the business.

Given the current Post Office shenanigans, it's questionable how much impact, obviously, but that's probably what's spooked your accountant  and he's not necessarily correct.

Neither are HMRC with their 'guidance', come to that.

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