CG16200 - Assets: valuation: introduction

There are many circumstances in which a valuation of an asset may be needed for Capital Gains Tax. The most common are

  • where an asset is disposed of to a connected person or otherwise by way of a bargain which is not at arm’s length, TCGA92/S17 and TCGA92/S18, see CG14530+.
  • where only part of an asset is disposed of and a valuation is needed of the part retained, TCGA92/S42, see CG12730+.
  • where rebasing to 31 March 1982 applies, TCGA92/S35, see CG16700+.
  • where rebasing to another date is required, for example with non-resident capital gains see CG73700+,  CG73920+
  • where an asset is inherited, TCGA92/S62, see CG31140.
  • where an asset is disposed of for consideration in monies worth rather than in cash, TCGA92/S37, see CG14500.

A person who has been issued with a return may be required under TMA70/S8 to make a return of chargeable gains. If no return has been issued TMA70/S7 requires a person who is chargeable to Capital Gains Tax to notify HMRC, see CG20220.

The return or notification should be of chargeable gains computed in accordance with the statute. If this requires a valuation it is the customers’ responsibility to provide it.

The valuation of assets can be a complex matter requiring professional qualifications.

Agreement to an incorrect valuation may cause difficulties not only in the case you are dealing with but also in other similar cases. It is important if we are to fulfil our obligations that all customers are dealt with consistently.

For these reasons HMRC employs professional valuers to check valuations on our behalf. Where the guidance requires you to refer valuations, for example to Shares and Assets Valuation or the Valuation Office Agency, for advice, you must do so.

When you have referred a valuation in accordance with the guidance, for example to the Valuation Office Agency or to Shares and Assets Valuation, and been advised of an appropriate valuation, you must rely on it in any dealings with the customer. Do not try to negotiate away valuation differences between a customer and our professional valuers. Professional advice is to be relied upon. To do otherwise is to compromise the standing of that advice and to make it harder for the adviser to reach agreement in other cases.

It may be necessary to check the sterling value of an asset for the purposes of chargeable gains. HMRC staff may obtain particulars of day to day exchange rates from Shares and Assets Valuation.

If you have any queries or valuation requests please contact SAV