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Where Taxpayers and Advisers Meet

CGT on goodwill to ltd co

Posts: 2
Joined: Mon Mar 20, 2017 5:52 pm

CGT on goodwill to ltd co

Postby ploddingon » Mon Mar 20, 2017 6:07 pm

Hi Forum members,

thanking you in advance for any help

tax year 06/07 sole trader sold up to ltd co with goodwill of £180k - paid GCT of £14.5K
goodwill left in and not paid to sole trader faces problems and is liquidated
query is if goodwill not paid to sole trader then is the CGT already paid recoverable by sole trader to offset against current liabilities?

Posts: 339
Joined: Thu Feb 23, 2012 10:26 am

Re: CGT on goodwill to ltd co

Postby Feedback » Tue Mar 21, 2017 4:12 pm

I doubt it but the owner may have a negligible value claim if the company is insolvent and now worthless

Ian McTernan CTA
Posts: 1232
Joined: Wed Aug 06, 2008 3:02 pm
Location: Bedford

Re: CGT on goodwill to ltd co

Postby Ian McTernan CTA » Tue Mar 21, 2017 4:28 pm

I'd say no. Because you made a gain years ago, and 10 years later are now (presumably) making a loss. The loss cannot be carried back, so there is no mechanism to recover the cgt paid 10 years ago.
McTernan Associates Ltd
Chartered Tax Advisers
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Posts: 2
Joined: Mon Mar 20, 2017 5:52 pm

Re: CGT on goodwill to ltd co

Postby ploddingon » Wed Mar 22, 2017 3:24 pm

Many thanks for your replies & would apreciate your thoughts on the below

Ian : the year CGT was paid and subsequent three years are "open" as they are subject of an ongoing inquiry by HMRC - in these circumstances does that change your opinion on possibility of success in seeking to recover ( or use to offset against other liabilities for that period) the CGT paid ?

another thought that may be arguable is that as the goodwill was never paid could it be deemed to be a capital loss by the sole trader ?

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