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HMRC internal manual

Company Taxation Manual

HM Revenue & Customs
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Distributions: general: valuations

Valuation Office Agency services will need to advise in cases where land in the UK, or an interest in such land, is transferred to or from a company, giving rise to a distribution. This is in addition to checking with Valuation Office Agency that the disposal has occurred at market value for CG purposes (see CG74300 onwards).

Form CG20, however applies only to CG valuation. For distributions, an informal valuation should be requested which must:

  • identify the land involved,
  • make clear that the request is to quantify liability under the distributions provisions,
  • specify the date at which the valuation is needed,
  • identify the company and the member concerned,
  • specify the precise interest which needs to be valued,
  • give details (if available) of the date the transferor bought the land, and the cost price,
  • include a copy of any tenancy agreement or ‘licence to occupy’ in force immediately prior to the transfer to the member (but bear in mind CTM15250), and
  • detail the consideration paid by the member to the company for the transfer.

If the company or the member disputes the informal valuation, ask them to agree a negotiated valuation with the Valuation Office Agency.

If the company/member and the Valuation Office cannot agree on a valuation the Valuation Office will provide a ‘defendable on appeal’ valuation. Send any such valuation to CTISA (Technical), see ‘Technical Help’ on the left bar, with the company file and a summary of the position.

For assistance with the valuation of shares or other assets see CG16200 onwards.