Valuation of Shares in Unlisted Companies for Tax Purposes
- CHAPTER 1 THE COMPANY AND SHAREHOLDER RIGHTS
- 1.1 INTRODUCTION
- 1.2 THE PRIVATE COMPANY
- 1.3 THE PUBLIC COMPANY
- 1.4 CONSTITUTION OF A COMPANY
- 1.4.1 Memorandum of Association
- 1.4.2 Articles of Association
- 1.4.3 Irish Stock Exchange
- 1.4.4 Unquoted Companies
- 1.5 SHARES AND SHAREHOLDINGS
- 1.6 SHAREHOLDERS? AGREEMENTS
- 1.7 FAMILY CONSTITUTION
- 1.8 SHAREHOLDINGS
- 1.8.1 75%+ Shareholding
- 1.8.2 51% to 75% Shareholding
- 1.8.3 Two 50% Shareholding
- 1.8.4 25% to 50% Shareholding
- 1.8.5 Less than 25% Shareholding
- 1.9 MINORITY SHAREHOLDINGS
- 1.9.1 Derivative Actions
- 1.9.2 Section 205 Remedy for Oppression of Minority
- 1.9.3 Winding-Up of a Company on Just and Equitable Grounds
- 1.10 DIRECTORS? OBLIGATIONS
- CHAPTER 2 VALUATION PRINCIPLES
- 2.1 INTRODUCTION
- 2.2 VALUATION DATE
- 2.3 OPEN MARKET VALUE
- 2.3.1 Hypothetical Open Market
- 2.3.2 Willing Purchaser and Seller
- 2.3.3 Price Paid by a Willing Purchaser
- 2.4 INFORMATION AVAILABLE
- 2.5 SPECIAL PURCHASERS
- 2.6 FAIR VALUE
- 2.7 RESTRICTIONS ON TRANSFER
- 2.8 ACTUAL SALES AND OFFERS
- 2.9 VALUATION FOR OTHER PURPOSES
- 2.10 PREVIOUS AGREEMENTS WITH REVENUE
- 2.11 DEFERRED SHARES
- CHAPTER 3 VALUATION FACTORS AND METHODS
- 3.1 INTRODUCTION
- 3.2 THE VALUATION PROCESS
- 3.3 INFORMATION REQUIRED
- 3.4 FACTORS AND CONSIDERATIONS TO BE CONSIDERED
- 3.4.1 The Company
- 3.4.2 The size of the shareholding and the rights attaching to the shares
- 3.4.3 Business Activity of the company being valued
- 3.5 FUTURE ORIENTATION VERSUS POST VALUATION EVENTS
- 3.6 VALUATION METHODS AND CHOOSING A VALUATION METHOD
- 3.7 DIVIDEND YIELD BASIS
- 3.7.1 Introduction
- 3.7.2 The maintainable dividend
- 3.7.3 Required rate of return
- 3.7.4 Same dividend paid every year
- 3.7.5 Constant growth dividend
- 3.7.6 Random / fluctuating dividends
- 3.7.7 No dividends paid
- 3.7.8 Discounting dividend yield valuations
- 3.8 EARNINGS BASIS
- 3.8.1 Introduction
- 3.8.2 Future Maintainable Earnings
- 3.8.3 Weighting Recent Results
- 3.8.4 Adjustments
- 3.8.5 Capitalisation of the earnings
- 3.8.6 Price earnings ratio method
- 3.8.7 Discount for lack of marketability
- 3.8.8 Choosing a PER
- 3.8.9 Necessary adjustments to the PER
- 3.8.10 Indices basis
- 3.9 NET ASSET BASIS
- 3.9.1 Net Assets
- 3.9.2 Patents, trademarks and brands
- 3.9.3 Goodwill
- 3.9.4 Valuation of intangible assets
- 3.9.5 Super profits approach
- 3.10 LIQUIDATION VALUATIONS
- 3.11 OTHER VALUATION METHODS
- 3.11.1 Cash flow
- 3.11.2 Discounted Cash flow
- 3.11.3 Turnover
- 3.11.4 Other similar transactions
- 3.11.5 Formula valuations
- 3.12 HYBRID VALUATIONS
- 3.13 PREMIUM FOR VOTING SHARES
- 3.14 DISCOUNT FOR LACK OF MARKETABILITY
- 3.15 DISCOUNT FOR LACK OF PROFITABILITY
- 3.16 PREFERENCE SHARES
- 3.17 AN ALTERNATIVE APPROACH??
- CHAPTER 4 STAMP DUTIES
- 4.1 INTRODUCTION
- 4.2 VALUATION
- 4.2.1 Section 19: Valuation of Property Chargeable with Stamp Duty
- 4.2.2 Section 26 CATCA: Market Value of Property
- 4.2.3 Imposition of Market Value for Sales Consideration
- 4.2.4 Surcharges for Undervaluation in Voluntary dispositions.
- 4.2.5 Right of Appeal of Persons Dissatisfied with Stamp Duty Assessment
- 4.2.6 Internal Review
- 4.3 COMPANIES? CAPITAL DUTY
- 4.4 APPEAL
- CHAPTER 5 CAPITAL GAINS TAX
- 5.1 INTRODUCTION
- 5.2 THE RELEVANT LEGISLATION
- 5.3 DISCUSSIONS OF THE RELEVANT SECTIONS
- 5.4 IMPOSITION OF MARKET VALUE
- 5.5 SECTION 549 - TRANSACTION BETWEEN CONNECTED PERSON
- 5.5.1 Section 549
- 5.5.2 Section 10 TCA - Connected Persons
- 5.5.3 Section 432 TCA - Meaning of ?Associated Company? and ?Control?
- 5.5.4 Section 550 - Assets Disposed Of in a Series of Transactions
- 5.6 SECTION 557 - PART DISPOSALS
- 5.7 SECTION 559 - ASSETS DERIVED FROM OTHER ASSETS
- 5.8 SECTION 563 - CONSIDERATION DUE AFTER TIME OF DISPOSAL
- 5.9 SECTION 573 - DEATH
- 5.10 SECTION 575 - GIFTS IN SETTLEMENT
- 5.11 SECTION 576 - PERSON BECOMING ABSOLUTELY ENTITLED TO SETTLED PROPERTY
- 5.12 SECTION 577 - TERMINATION OF LIFE INTEREST
- 5.13 SECTION 579B AND SECTION 579E
- 5.14 SECTION 584 - REORGANISATION OR REDUCTION OF SHARE CAPITAL
- 5.15 SECTION 589 - SHARES IN CLOSE COMPANY TRANSFERRING ASSETS AT UNDERVALUE
- 5.16 SECTION 538 - DISPOSALS WHERE ASSETS LOST OR DESTROYED OR BECOME OF NEGLIGIBLE VALUE
- 5.17 SECTION 543 - TRANSFERS OF VALUE DERIVED FROM ASSETS
- 5.18 SECTION 29 - PERSONS CHARGEABLE
- 5.19 QUOTED ON A STOCK EXCHANGE
- 5.20 DIRECTLY OR INDIRECTLY
- 5.21 VALUE OR GREATER PART OF VALUE
- 5.22 APPLYING THE TEST
- 5.23 NET ASSETS BASIS
- 5.24 GROSS ASSETS BASIS
- 5.25 ATTRIBUTION OF LIABILITIES
- 5.26 MORTGAGES, ETC
- 5.27 VALUATION OF SHAREHOLDING
- 5.28 SECTION 29A - TEMPORARY NON-RESIDENTS
- 5.29 SECTION 542 TIME OF DISPOSAL AND ACQUISION
- 5.30 VALUATION AT 6 APRIL 1974
- CHAPTER 6 CAPITAL ACQUISITIONS TAX
- 6.1 INTRODUCTION & GENERAL OVERVIEW OF CAT
- 6.2 THE RELEVANT LEGISLATION
- 6.3 SECTION 2 - GENERAL INTERPRETATION
- 6.4 SECTION 30 VALUATION DATE FOR TAX PURPOSES
- 6.5 SECTION 26 MARKET VALUE OF PROPERTY
- 6.6 SECTION 27 - MARKET VALUE OF CERTAIN SHARES IN PRIVATE COMPANIES
- 6.7 SECTION 38 - disposition ENLARGING VALUE OF PROPERTY
- 6.8 SECTION 44 - ARRANGEMENTS REDUCING VALUE OF COMPANY SHARES
- 6.9 BUSINESS PROPERTY RELIEF
- 6.10 BUSINESS PROPERTY RELIEF (BPR)
- CHAPTER 7 OTHER PROVISIONS
- 7.1 INTRODUCTION
- 7.2 SECTION 122A TCA
- 7.3 SECTION 128 TCA
- 7.4 SECTION 130 TCA
- 7.5 SECTION 479 TCA
- 7.6 PART 16 TCA
- 7.7 SECTION 541 TCA
- 7.8 SECTION 596 TCA
- 7.9 SECTION 598 TCA
- 7.10 SECTION 620A TCA
- 7.11 SECTION 621 TCA
- 7.12 SECTION 625 TCA
- 7.13 SECTION 1028 TCA, 1030 TCA, 1031 TCA
- 7.14 SECTION 70, SECTION 71, SECTION 88 CATCA
- APPENDIX 1 SUGGESTED SHARE VALUATION PROCESS
- APPENDIX 2 SAMPLE INFORMATION CHECKLIST
- APPENDIX 3 SELECTED FINANCIAL RATIOS
- APPENDIX 4 SUMMARY OF SHAREHOLDINGS
- APPENDIX 5 SUMMARY OF PRICE EARNINGS RATIOS
- APPENDIX 6(i) REVENUE QUESTIONNAIRES ON VALUATION OF UNQUOTED SHARES
- APPENDIX 6(ii) INSTRUCTION LEAFLET ON CAT SHARE VALUATIONS FORM
- APPENDIX 7 EXTRACTS FROM REVENUE PRACTICE MANUALSONSHARE VALUATIONS
- APPENDIX 8 THE RICS APPRAISAL AND VALUATION STANDARDS
- APPENDIX 9 REVENUE EXPLANATORY LEAFLET CGTI
- TABLE OF STATUTORY REFERENCES
- TABLE OF CASES