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5. Valuations

As well as a comprehensive framework, the valuation should include robust support for the inputs to the calculations. Each position taken in a valuation, from the entity cited as the legal owner of the asset, to an appraisal of the forecasts, should be supported by evidence.



Valuations of intangibles are handled by Shares and Assets Valuation (‘SAV’), HMRC’s business valuation arm. SAV’s intangibles valuers work to a comprehensive framework, of which the valuation calculations form only one part. Analysing the reorganisation and asset identification are fundamental to the SAV analysis. The legislation governing the taxation and valuation of intangibles is so complex that a meaningful and rigorous valuation exercise can only be undertaken once it has been correctly framed.

The difference in outcomes which can arise for each of market value and arm’s length provision should be a key focus.

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