Fractional interests in partnership assets acquired in stages: SP D12
Paragraph 10 SP D12
Where partners acquire their fractional interests in partnership assets in stages over a period of time the acquisition costs are pooled.
X was admitted to a partnership in 2004 at which time he acquired a 20% interest in goodwill. His interest in goodwill was increased in subsequent years:
The base cost of Partner X’s 35% interest in goodwill for CG purposes is £185,000.
Any subsequent reduction in Partner X’s interest in goodwill will be treated as a part-disposal out of the pooled expenditure.