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CGT treatment of goodwill and intellectual property rights
C3.1501 CGT treatment of goodwill and intellectual property rights—overview
Defining goodwill
Goodwill, which is an asset within the meaning of TCGA 1992, s 21(1)1, is not defined for capital gains tax (CGT) purposes. HMRC refers to the decision in Balloon Promotions Ltd; Vela-Castro2 which provides authority that goodwill should be construed in accordance with legal rather than accountancy principles in the context of CGT3. The leading legal authority is given in a stamp duty case4 which held that goodwill is the benefit and advantage of the good name, reputation and connection of a business. Intellectual property rights (IPRs) include registered trade marks and designs, franchise rights,
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