Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Circumstances alter cases

12 December 2007 / Mick Ruse
Issue: 4138 / Categories: Comment & Analysis , Admin , Capital Gains
MICK RUSE discusses market value and information standards when valuing minority holdings of unquoted shares


  • No two valuations are exactly the same.
  • Management accounts may be required in some valuation cases.
  • It may be unwise to place much reliability on forecast profits.
  • Would statutory regulation help with information standards?

After 'What price earnings ratio should be used?' and 'what is the discount from net assets?' the next most commonly asked question about the mechanics of fiscal share valuation is 'what information is relevant?' on which this article sets out to shed a little light.

The historical position

Thirty or more years ago the market value of unquoted shares was determined through the application of a set of fairly well defined rules. A dividend yield approach often produced a low value even if earnings were strong and underlying net assets were high.

The importance of dividend yield did carry with it...

If you or your firm subscribes to, please click the login box below:

If you are not a subscriber but are a registered user or have a free trial, please enter your details in the following boxes:

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.

Please reach out to customer services at +44 (0) 330 161 1234 or '' for further assistance.

back to top icon