HMRC has set out its views on the implications of the Special Commissioner's decision in the case of Balloon Promotions Ltd and Other, which confirmed the existence of goodwill where HMRC have always said that there could be none.
Not surprisingly, HMRC do not feel that the decision is of general application to other cases involving the sale of franchised businesses.
Decision of Special Commissioner (SpC524) 3 March 2006: Balloon Promotions Limited (Appellant 1) and Alonso Vela-Castro, Edward Kidney and Natale Lucibello (Appellant 2) v Wilson and Rodin.
Roll-over relief and goodwill
Briefly, the facts were that the appellants were members of partnerships whose Pizza Express franchised restaurants were acquired by Pizza Express (Restaurants) Ltd for the purpose of operating them in-house...