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I am thinking of buying into a franchise. Is there anything specific I should do?

Talk the franchise proposition through with an accountant.  If you still think it is a good proposition, decide on the business structure (e.g. Limited Company), bookkeeping records and VAT registration, as with any business.

Franchisees often pay a large lump sum for a number of different costs – but without paperwork to show the split between the various items, it’s potentially a big problem for your accountant. 

Example: a franchisor may ask for £10,000 to cover: the licence; initial stock; equipment; training and support for several years. Each of these costs needs a different accounting and tax treatment – so get a breakdown with the costs for each individual item.  Without this, HMRC could seek to treat all costs as Capital expenditure resulting in a higher tax bill for you – at least in the first year of the business.