CG14545 | Consideration for disposal: market value rule: objective indicators

The test which must be satisfied is subjective: the test is whether there was an intention to confer a gratuitous benefit or ‘give bounty’. There are objective pointers which may indicate the underlying intention. The following list (which is not exhaustive) suggests information which you may need to consider:

• the presence or absence of real negotiations between the parties about the terms of the transaction

• how the terms of the transaction compare with those in similar commercial transactions

• whether the parties have separate legal or other professional representation

• whether the parties have received independent advice

• the character of any comparable prior dealings between the parties

• whether the transaction between the parties may be linked with any other transaction between the same parties

• the relationship between the parties outside the transaction in question.

It is important to consider all of the available evidence.