Q&A: tax relief on purchased goodwill

In this week’s Q&A, Joshua Hamley-Deane, adviser at Croner-i VIP Tax Team, explains the tax implications of intangible assets and purchased goodwill

Q. Can you please advise where a limited company has purchased goodwill for £100,000 and this mainly includes purchase of client customers only from another company, would there be any tax relief that the company could claim as the goodwill was purchased on 1 September 2024.

A. If goodwill was the only intangible asset acquired, no tax relief will be due on the amortisation of the goodwill.

Since 1 April 2002 the corporation tax treatment for intangible assets is determined by the intangible fixed asset rules in Corporation Tax Act 2009 (CTA), Part 8.

All legislation referred to in this article relates to CTA 2009.