April 20, 2021

The client (a private company) has a loan from a shareholder (an individual). The shareholder wishes to forgive part of the loan owing from the company. What are the tax implications for the company and the shareholder, if any? No interest has been charged or paid on the loan.

A client purchased a franchise (that is, a right to operate as a franchise in a certain area). The client did not go ahead with the franchise business but did spend $25,000 on the purchase.Is the $25,000 capital or is can this be claimed as general business deductions against his other business income?