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TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15950
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
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sole trader wants to buy costumers from another person in

Resolved Question:

sole trader wants to buy 'costumers' from another person in the same business. can that be included in capital allowance/or business expenses. accounting is cash based and amount is £1300
Submitted: 3 years ago.
Category: Tax
Expert:  TonyTax replied 3 years ago.

Do you mean that you are buying the other business or you are buying their costumes.
Customer: replied 3 years ago.

Hi, i mean a window cleaner is buying a 'a round' or more costumers from another window cleaner.

Expert:  TonyTax replied 3 years ago.

Leave this with me while I draft my answer.
Expert:  TonyTax replied 3 years ago.

Hi again.

I guess you meant "customers".

What you are doing is spending capital or buying the "goodwill" of another business. Unfortunately, as a sole trader, you cannot write the cost of £1,300 off against tax or claim it as an expense as it is capital in nature. In effect, it becomes part of the cost of your existing business which you can deduct from the disposal proceeds of your business if you ever sell it to work out the capital gain.

I'm sorry I wasn't able to give you some good news. Let me know if you have any further questions.

TonyTax and other Tax Specialists are ready to help you
Customer: replied 3 years ago.

I thought so. Thank you for your help

Expert:  TonyTax replied 3 years ago.