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Where Taxpayers and Advisers Meet

corporate hive up goodwill.

okevin
Posts:154
Joined:Wed Aug 06, 2008 3:41 pm
corporate hive up goodwill.

Postby okevin » Fri Jul 24, 2009 8:08 pm

Hi,

Company A purchased the share capital of Company B.

Imediately afterwards Company B's trade and assets were hived up into Company A.

Company B is now dormant, Company A owns all income and assets previously held by Company B.

The deal was seller driven, i.e.if Company A wanted B, it would have to purchase shares and not assets.

Company A now has goodwill relating to the purchase of the Company B business.

My question:

Is amortisation on the goodwill allowable for Corp Tax.

I understand that the goodwill was not purchased from Company A, but was hived up into it by accounting entry, however it was still goodwill paid by a Company A to purchase the business from an unconnected Company B.

Thanks

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