Valuation Office — Capital Gains and other taxes manual Section 7

Fees

Envisage the circumstance of an open market disposal of a property in co-ownership where the co-owners’ acquisition was by way of gift of the entirety from a connected party. The Inspector may request the valuation of either of the co-owner’s undivided half share interests at the time of acquisition in order to provide an acquisition cost. In this circumstance an undivided share discount should not be made unless the interest originally held by the donor was itself an undivided share. The reason is that for CGT the gift will have been a disposal by the donor. At the time of the gift, the disposal by the donor was of the entirety interest and the consideration for the disposal is deemed to be equal to the market value of the asset disposed of. In this situation, the same figure must be used as the acquisition cost of the persons who acquired the asset (just as it would be if they had acquired the entirety in an arms length transaction). Thus when two people acquire the asset their acqui