OT30311 - Capital Gains

Valuation of Oil Assets (including shares). Principles of Valuation. Incorrect Methods of Valuation.

Sometimes valuations are based on

• intrinsic value,
• replacement value, or
• cost of labour and materials.

Each of these approaches may provide a useful check on the accuracy of a market value estimated in accordance with TCGA92/S272 (1). But it is the price which a willing buyer would pay to a willing seller at the valuation date which is to be taken as the market value. For example, the value of a house may bear no relation to the value of the bricks and other materials which make up that house.