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Business transferred as a going concern

HMRC considers that because goodwill is inseparable from the business in which it is generated, the disposal of a business as a going concern must involve the transfer of goodwill¹. Where the transfer agreement provides for one payment which is not split between the various assets being transferred, an apportionment of the consideration between those assets is necessary. A separate capital gains tax computation will be required for each asset.

In Butler v Evans², it was found as a fact by HMRC that a shop lease and the goodwill built up since the business was carried on were separate assets. See C2.101 regarding HMRC's guidance dealing with particular issues that arise when identifying the sum that can be apportioned to goodwill on a transfer of a business as a going concern.

In Leeds Cricket Football & Athletic Company Limited (Leeds CFA)³, Leeds CFA owned the freehold to Headingley cricket ground which it leased to Yorkshire County Cricket Club (YCCC) in order that YCCC could play