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UT-2023-000116; - [2025] UKUT 00164 (TCC)
Fecha: 05-Mar-2025
In paragraph 2 of FRS 7, the following relevant definitions are set out
In paragraph 2 of FRS 7, the following relevant definitions are set out:
Fair value:-
The amount at which an asset or liability could be exchanged in an arm’s length transaction between informed and willing parties, other than in a forced or liquidation sale.
Identifiable assets and liabilities:-
The assets and liabilities of the acquired entity that are capable of being disposed of or settled separately, without disposing of a business of the entity. f/n3[It can readily be seen that the wording of this definition tracks closely, but does not exactly follow, the definition contained in paragraph 9(2), Schedule 4A Companies Act 1985 (see [91] above). No change in meaning appears to be intended as a result of the slightly different words used, and neither party argued that the slight differences had any relevance for present purposes.]
Recoverable amount:-
The greater of the net realisable value of an asset and, where appropriate, the value in use.
Value in use:-
The present value of the future cash flows obtainable as a result of an asset’s continued use, including those resulting from the ultimate disposal of the asset.
- Heading
- Table of contents
- Introduction
- Background
- The issues before the FTT – in outline
- The statutory provisions, frs and rics materials
- Stamp Duty Land Tax
- Companies Act, Financial Reporting Standards and RICS Appraisal and Valuation Manual
- The FTT’s Decision
- The Decision - Corporation tax legislation
- The Decision - Corporation Tax and the Accounting context
- The Decision - The Court of Appeal decision in Denning
- The Decision - The FTT’s main conclusions on accounting and valuation
- The Decision - Stamp Duty Land Tax
- The Decision – the FTT’s summary and conclusions
- Ground 1: The FTT erred in considering whether there was an open market in assets similar in type and condition to the identifiable assets
- Ground 1 : the FTT erred when it stated at FTT [220] that GAAP required the valuation of “only the “identifiable asset” in each case, i.e. assuming there to be no current staff, residents, contracts
- Relevant general principles- Grounds 1, 2, 3 and 4(1)
- HMRC v Denning [2022] EWCA Civ 909 (“Denning”)
- Discussion: Grounds 1, 2, 3 and 4(1)
- Nellsar’s appeal - Ground 4 (2)
- Nellsar’s appeal - Ground 5
- HMRC appeal – Grounds 1 and 2
- Disposition
- costs
- MR JUSTICE MELLOR
- The “fair value” concept is explored in detail in FRS 7 “Fair Values in Acquisition Accounting”
- In paragraph 2 of FRS 7, the following relevant definitions are set out
- The following relevant passages appear in the “Statement of Standard Accounting Practice” section (paragraphs 4-31) of FRS 7
- Conclusions