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HMRC internal manual

Company Taxation Manual

Corporation Tax: management expenses: valuations

The cost of a valuation, which a company makes for the purpose of Companies Act 1985 Schedule 7 paragraph 1, should be regarded as an expense of management. The broad reason a company needs to make such a valuation is if there is a significant difference between the market value and balance sheet value of an interest in land. The company has to bring this difference to the attention of the members of the company or the debenture holders.

Other property valuations would not generally be expenses of management. Where a claim is made consider the detailed facts. In most cases such valuations are more likely to be costs of acquisition or disposal of investments as the case may be, and are not therefore expenses of management.