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HMRC internal manual

Capital Gains Manual

Assets: principles of valuation: flooding the market

TCGA92/S272 (2)

It follows from the application of the lotting principle explained at CG16340-16342 that you should not suggest or accept a reduction in valuation on the basis that the sale of a large block of assets which are to be valued would flood the market and so would reduce the price received for each. TCGA92/S272 (2) provides for any such flooding effect to be ignored.

This too is illustrated by the Estate Duty case referred to at CG16340. Although the Estate was to be divided into appropriate units for valuation purposes the value of each unit was the price which could be obtained on a sale of that unit alone. Any reduction in value which could be caused by selling all the units at once was to be ignored.