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The goodwill hunt

25 November 2008 / Chris Hart
Issue: 4186 / Categories: Forum & Feedback
from CHRIS HART, vice-chairman, RICS Taxation Policy Panel

In her article Goodwill hunting Jenny Nelder made comments concerning the 'surveyor's' view of goodwill as expressed during the Balloon case.

Following that decision the RICS Trade Related Valuation Group reviewed and partially re-wrote Guidance Note 1 (GN1) of the RICS Appraisal and Valuation Standards in order to achieve greater clarity.

There is no property valuation based definition of goodwill in its fiscal or accounting sense; in GN1 we refer to transferable goodwill which while an intangible asset is inherent to the specialised trading property and which will transfer to a new owner on sale.

This is where the property transferred is a fully-equipped operational entity which is both trading and which has a reasonable expectation of continuing to trade. An empty or new property or a property with no existing trade would be valued using different assumptions.

A valuation on a GN1...

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