Summary
The First-tier Tribunal (FTT) allowed the appellant’s appeal in part against an amendment by HM Revenue and Customs (HMRC) to his tax return for 2002/03 in respect of the capital gain arising from his disposal of goodwill in an accountancy practice, based on the valuation attributed to the goodwill in the practice.
Background
The appellant acquired his practice in July 1981, when £100,000 of client business was transferred to him. The appellant increased the size and profitability of the practice over the years. He transferred his share of the practice to a company on 1 April 2003. At that time, the goodwill in the practice was valued at £1,650,000, of which the appellant’s share was 84.85% (the other 15.15% related to his business partner).
The appellant’s tax return stated that the capital gains tax (CGT) arising from his
