Hello there everyone I have a question on Goodwill in a CC
I am about to buy a business for 2m rand, but it only has physical tangible assets of 0.5m R
This will be the purchase of an existing CC
I am going to pay the owner 2m rand.
however I am taking a loan to purchase the cc.
I AM CONVINCED I SHOULD BE ABLE TO MAKE THE INTEREST DEDUCTIBLE
THE WAY I SEE IT, I SHOULD CREATE A GOODWILL ENTRY (DEBIT) OF 1.5M AND A CREDIT SHAREHOLDER LOAN FOR 1.5M
ALTHOUGH THIS NEW CAPITAL IS NOT GOING INTO THE CC, IT IS AN INTANGIBLE ASSET I AM BUYING FROM THE CURRENT OWNER.
Does anyone see a problem with my proposal. Or do you have a better way of effecting the above.
Your help would be greatly appreciated and I am sure the question is pertinent to other members
Thank you in advance!