In Greenbank Holidays Ltd v HMRC (Upper Tribunal – 13 April) a company (G) purchased the goodwill of another company (K) in the same group in 2003. In its corporation tax return G claimed a substantial deduction for the cost of the goodwill.
HMRC rejected the claim on the grounds that it had been created by K before 1 April 2002 and thus failed to meet the requirements of FA 2002 Sch 29 para 118.
The First-tier Tribunal dismissed G’s appeal and the Upper Tribunal upheld this decision. Arnold J observed that ‘it is manifest that what happened on 30 September 2003 was that (K) sold and (G) purchased that goodwill’.
The accounting treatment which G had adopted ‘did not mean that the goodwill either came into existence for the first time or that it was a different asset to...
