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taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I sold my goodwill on 31/3/12 sum based on the fees earned

Resolved Question:

I sold my goodwill on 31/3/12 for a sum based on the fees earned by the business in the next 5 years; I put an estimated sale figure in the 2011/12 CGT computation based on my expectation ; the payments received now exceed that figure and will continue for two more years. Should I ask HMRC to re-open the 2011/12 assessment with my amended estimate ?
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.
Hello and welcome to the site. Thank you for your question.

As the actual amount received is higher than the estimated sale figure in your CGT computation for 2011/12, you are advised to write to HMRC and notify the amended figure.

You could not change the figures and send an amended tax return online as it relates to a prior year.

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 2 years ago.

I assume that you are content that any adjustments will relate to the 2011/12 tax year ( and attract 10% Entrepreneurs' Relief) and further sums received will not be treated as disposals in the year of receipt

Expert:  taxadvisor.uk replied 2 years ago.

Thank you for your reply.

If you qualified for Entrepreneurs Relief and your gain was subject to CGT rate of 10%, then there will be no change to the rate.

As far as the second part of your statement goes ... all depends on what was agreed with HMRC when the gain was declared. If the whole gain was declared as a chargeable event in tax year 2011/12 then an amendment to original gain would be taxed in 2011/12 and won't be treated as disposals in the year of receipt.

I hope this is helpful.

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