OT30306 - Capital Gains

Valuation of Oil Assets (including shares). Principles of Valuation. Meaning of Market Value.

CG16210 explains that the market value of an asset at a particular date may enter into the computation of a chargeable gain in several circumstances. In each case the definition of market value is given by TCGA92/S272 (1) as

• 'The price which those assets might reasonably be expected to fetch on a sale in the open market.'

“Assets” includes unquoted shares and securities. TCGA92/S273 requires, in respect of shares and securities not quoted on a recognised stock exchange, that, when assessing their open market value, there is available all the information which a prudent, prospective purchaser might reasonably require if he were proposing to purchase it from a willing vendor by private treaty and at arms length.