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Goodwill retained

31 August 2010
Issue: 4270 / Categories: Tax cases
Countrywide Estate Agents FS Ltd (TC557)

The taxpayer company Countrywide Estate Agents FS was within the financial services group of the Countrywide Group. It provided advice relating to mortgages life assurance and other insurance products through the estate agency chain of the business.

The estate agent introduced its customer to the appellant who would discuss the customer’s requirements and recommend a mortgage product and life insurance. The appellant’s staff would then introduce the customer to Countrywide Assured’s life insurance product.

In 2002 Countrywide Assured decided it would no longer write new life policies and therefore had to find a new provider. After negotiations a distribution agreement was made with Friends Provident for it to provide life insurance.

An up-front payment of £25 million was made by Friends Provident to the appellant as consideration for the exclusive right to distribute life products to the appellant’s customers. In addition ...

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