Purposes · scope · next steps
Formal Business Valuation Guide
Understand when you need an adviser-prepared valuation, what the service includes and how to request an assessment for your business or shares.
Choose the purpose before choosing the number
A formal business valuation is an adviser-prepared written opinion for a defined purpose, subject and valuation date. It explains how the conclusion was reached, which information was used and what assumptions or limitations apply. The starting question is not simply ‘What is my business worth?’ It is ‘What needs to be valued, at what date, for whose decision?’ A whole trading business, the equity of a company and a particular parcel of shares are different subjects. Getting those distinctions right helps prevent a seemingly precise figure from being used for the wrong decision.
Use the purposes below to describe the situation you are facing. You do not need to decide the technical basis yourself before requesting an assessment. Tell us whether this concerns a tax matter, an estate, a shareholder, a court, trustees, a lender, the accounts or a planned transaction. We can then discuss the intended recipient, any instructions already received and the expertise needed. Where the work requires specialist tax, legal, accounting or expert-witness input, our team can assess the appropriate role for our specialist partner network before an engagement is agreed.
The free indicative valuation is a separate planning tool. It uses the figures and answers you enter to provide an indication, without independently checking your records or investigating the legal rights attached to shares. Its optional six-page summary is not a formal valuation and must not be used for HMRC, EMI, probate, EOT trustee reliance, court proceedings, divorce, shareholder disputes, lending or other legal and formal purposes. You can request a formal assessment directly; completing the free calculator first is not a condition of requesting professional help.
Available formal valuation purposes
These are starting points for an assessment, not interchangeable report types or a guarantee that every instruction can be accepted.
EMI or HMRC share valuation
For an EMI share scheme, tax submission or another HMRC-related purpose. The relevant shares, rights, valuation date and tax basis need to be identified before the work is scoped. Where relevant, the adviser considers actual market value and unrestricted market value separately; these are not interchangeable.
Tax planning and share transfers
For proposed gifts, transfers, restructuring or other tax-related decisions where business or share value matters. Tell us what is being transferred and why. A valuation supports the evidence; it does not determine relief eligibility or replace advice on the tax consequences of the transaction.
Probate or estate administration
To help establish business or share value following a shareholder’s death. The assessment considers the relevant date, the interest held and the information available for that date. Executors should coordinate the instruction with their estate and tax advisers rather than use a current sale estimate as a substitute.
Divorce or court proceedings
For a business interest relevant to financial remedy or other court proceedings. The legal team should confirm the required instruction, expert role and court timetable. We assess whether an appropriately qualified specialist is needed; an ordinary owner-planning report is not automatically a court-compliant expert report.
Shareholder disputes
For disagreements over business or share value, including a proposed resolution or buyout. The shareholder agreement, articles, relevant correspondence and any legal directions can affect the brief. No minority discount or particular basis should be assumed before the instruction and legal context are understood.
Shareholder departure, death or resignation
For a minority shareholder buyout or a shareholder leaving through resignation, retirement or death. This is distinct from a dispute and from probate: a departure following death does not by itself establish an estate-administration instruction. Share rights and contractual buyout provisions need review.
Employee Ownership Trust transactions
For an EOT proposal where trustees and their advisers need evidence to assess the business value and proposed consideration. Clarify who is commissioning the work and who may rely on it. Valuation, trustee responsibilities, funding and tax eligibility are separate matters requiring coordinated advice.
Lending and acquisition finance
For a lender or funding decision involving a business or share acquisition. The lender may specify its own acceptable adviser, basis and report requirements. Confirm those requirements before commissioning work; a report prepared for another purpose may not satisfy the credit process.
Financial reporting
For accounting-related business or share valuations where the reporting framework and intended use determine the approach. We first assess the required scope and specialist expertise, including any auditor requirements. An owner’s market-value estimate is not automatically the appropriate measurement for the accounts.
Planned sale with adviser review
For an owner or board wanting a documented, adviser-reviewed view before a sale, succession or negotiation. The report can support decisions but is not an offer, a promise of buyer interest or a guaranteed selling price. A negotiated outcome can differ with timing, deal structure and buyer circumstances.
What the formal valuation service includes
The first part of the service is scoping. We discuss the business, the issue you need to resolve, the interest being valued, the relevant date and the intended users of the work. This establishes whether a formal valuation is the right next step and whether a specialist needs to be involved. The initial discussion is not itself a valuation opinion. A written scope should set out the agreed deliverable, fees, timetable, responsibilities and permitted reliance before substantive work begins. Do not assume that tax advice, legal drafting, negotiations with an authority or attendance at a hearing are included unless they are expressly agreed.
Once instructed, the agreed review can examine the financial records and commercial context relevant to the valuation. This may include statutory accounts, recent management accounts, trading trends, debt and cash, ownership information and significant contracts or business risks. For an earnings-based assessment, adjustments should be supported rather than accepted simply because they increase profit. Exceptional costs, owner remuneration, related-party arrangements and ongoing replacement costs need consideration in context. For a business with substantial assets, asset information may also matter. The level of investigation and the information required depend on the purpose and scope.
The methodology is selected to fit the business and instruction, not to achieve a preferred answer. Earnings-based approaches, asset-based approaches, discounted cash flow and market evidence may each have a role, but not every method is suitable or necessary in every case. Where comparisons are used, the adviser needs to explain their relevance and limitations. Where future cash flows are used, forecast assumptions need examination. A formal report should make material assumptions visible and explain the relationship between the financial information, the chosen approach and the conclusion. An unexplained multiple alone is not an adequate account of the reasoning.
The written deliverable should identify the subject and valuation date, purpose and basis, information relied on, methods applied, material assumptions, limitations and conclusion. Where appropriate to the instruction, it can include earnings adjustments, the bridge from enterprise value to equity value, share-rights analysis and sensitivity to important assumptions. The final format and level of detail are agreed for the audience; there is no universal required page count. Any opportunity to check factual information, discuss the report or address subsequent questions should be specified in the scope. A factual review is not an invitation to negotiate a desired valuation result.
Why the date, share rights and basis matter
A valuation speaks to a particular date. An assessment for a historical tax event or a death may require records and circumstances relevant to that earlier date, rather than today’s trading position. A planned transaction may need a more recent date. The adviser should distinguish what was known or reasonably knowable at the valuation date from later developments. If you have an existing deadline or a date specified by an authority or legal adviser, tell us at the beginning. A report does not have a universal shelf life: the relevant event, receiving party and subsequent business changes determine whether further work is needed.
Enterprise value and equity value are not the same thing. Enterprise value concerns the operating business; equity value reflects the position attributable to shareholders after relevant cash, debt and other agreed adjustments. A value for a shareholding also depends on its particular rights and restrictions. Voting rights, dividend rights, different share classes, transfer restrictions, options and contractual buyout provisions can be relevant. Owning a percentage of the shares does not mean every instruction should mechanically allocate that percentage of a headline business value. Equally, a minority discount is not automatic, statutory in every context or a fixed percentage.
Terms such as market value and fair value need to be interpreted within the relevant instruction, statute, contract or accounting framework. There is no single court basis that can be assumed for every dispute or divorce, and tax-related share valuations can involve specific concepts that differ from an owner’s sale-planning question. This is why legal and tax advisers should help clarify the brief where appropriate. The formal report should state its basis and permitted use clearly. A report commissioned for one audience should not be forwarded to another as if reliance were unrestricted; any new use may require consent, a revised scope or a separate opinion.
What to prepare for the assessment
For the initial request, a concise explanation is enough: your business name and sector, the reason for the valuation, the interest involved, the relevant date if known and any deadline. Say whether the request comes from an owner, executor, trustee, board, solicitor, accountant or lender. If you are unsure how to categorise it, describe the underlying situation rather than select a technical term you are not confident about. There is no need to paste sensitive financial records or personal details about other shareholders into an initial message. We can agree the information needed and how it should be provided after discussing the instruction.
For substantive work, the adviser may request recent statutory accounts, management accounts and an explanation of material changes in trading. Depending on the purpose, useful supporting records can include a debt and cash schedule, forecasts with assumptions, asset details, customer concentration information and evidence for proposed earnings adjustments. For a share valuation, the articles, shareholder agreement, share register and details of options or different share classes may be important. Historical instructions may need accounts and ownership records covering the relevant period. These are examples, not a fixed upload requirement or a promise that every item will be needed.
If the records are incomplete, tell us early. An adviser can explain what can be assessed, what additional evidence is needed and whether limitations would make the intended report unsuitable. Missing records should not be replaced with confident-looking assumptions without disclosure. Similarly, explain any dispute, connected-party transaction, unusual contract or material event that might affect the instruction. A clear explanation of a difficulty is more useful than a polished but incomplete data pack. It allows the scope, timetable and expectations to be set realistically before anyone relies on the final work.
What You Need to Get Started
You do not need every document listed below before making an enquiry. An initial discussion can normally begin with the purpose of the valuation and a small number of core financial and ownership records.
- Latest three years’ statutory accounts, where available.
- Current management accounts.
- Latest budget or financial forecast.
- Details of cash, borrowing and other debt.
- Current ownership and shareholding information.
- The valuation purpose, required valuation date and any known deadline.
If some of this information is unavailable, do not delay making an enquiry. The adviser will explain what is needed after understanding the purpose and circumstances.
Full Document Checklist
The following information may be requested depending on the purpose, complexity and agreed scope of the valuation. It is a preparation guide, not a mandatory upload list.
If an item does not exist or cannot be located, say so. An adviser can explain what can still be assessed and whether limitations would make the intended report unsuitable, which is more useful than a polished but incomplete pack.
Business fundamentals
- Registered company name, company number and registered office
- A short description of what the business does, its sector and how it earns money
- Main trading locations and activities
- Group structure, including any holding or subsidiary companies
- Key contracts, licences or leases the business depends on
Financial records
- Statutory accounts for recent years — the adviser confirms how far back the purpose requires
- The most recent management accounts
- Budgets or forecasts, with the assumptions behind them
- An explanation of one-off or unusual items affecting reported profit
- Owner remuneration: salary, dividends, benefits and pension contributions
- A schedule of debt: loans, overdrafts, hire purchase and director loans
- Cash balances and the normal working-capital position
- Details of any related-party transactions
- A list of significant fixed assets, and any separate property valuations
Ownership and share rights
- Articles of association, including any amendments
- The shareholders' agreement and any side agreements
- The share register: classes, holders and when interests were acquired
- Details of options, warrants or convertible instruments, including EMI schemes
- Anything affecting control: transfer restrictions, veto or exit provisions
Context that affects value or scope
- Customer and supplier concentration, and major contracts
- Key-person dependencies
- Recent significant events: lost customers, disputes, litigation or regulatory change
- Any previous valuations, offers or sale negotiations
- Known issues a buyer or adviser would raise, disclosed early rather than discovered later
Purpose, date and deadline details
- The valuation date, and the event that fixes it
- Any deadline: filing, hearing or transaction timetable
- Correspondence or instructions from HMRC, a solicitor, trustee, lender or court
- Who is instructing the work and who will rely on the report
- For an estate: the shareholdings at the date of death and the interest held
- For a dispute or court matter: any legal directions or expert instructions received
Keep sensitive records out of your first message. Do not send confidential accounts, tax records, legal correspondence or personal information through an initial website message. After the scope has been discussed, the adviser will explain how any required documents should be provided securely.
Ready to Discuss a Formal Valuation?
Tell us why the valuation is required, the relevant valuation date and any known deadline. There is no charge for making an initial enquiry. The scope and fee will be agreed in writing before work begins.
Request a Formal ValuationHow to request a formal valuation assessment
Start with the existing Request Formal Valuation enquiry page. Choose the formal business valuation reason and describe the purpose in your own words, including the date and deadline where relevant. The enquiry is a request to discuss suitability and scope; it does not commission a report, accept a fee or establish that a particular report will meet an authority’s requirements. Complete the contact and privacy steps on that page so our team can respond. You do not need to obtain an indicative calculator result or download a preparation plan before contacting us about a formal matter.
We then discuss the intended use and the information available. The appropriate next step may be an adviser-prepared valuation, a specialist instruction, clarification from your existing professional advisers or more preparation before a report can be scoped. If an engagement is appropriate, the scope, fee and timetable are agreed before work begins. We have not set a universal price or turnaround in this guide because complexity, share structures, historical dates, evidential requirements and specialist involvement can change the work substantially. If you face a filing, hearing or transaction deadline, explain it immediately; availability and achievable timing must be confirmed, not assumed.
Before accepting the proposed scope, check who is instructing the valuer, who can rely on the report and which questions the report will answer. Ask what additional work would be needed for authority queries, updates or expert evidence, and what happens if important information becomes available later. Your solicitor, accountant, trustee or lender may need to approve the instruction for their purpose. That coordination is part of making the report useful, not an administrative afterthought. A well-scoped assessment gives you a clear route forward without implying that any valuation guarantees approval, a tax outcome or a final sale price.
Initial discussion without obligation. Scope, fees and timing agreed before work begins.
Related guidance
- Formal valuation for employee share options — AMV, UMV and the HMRC valuation process.
- Management buyout valuation — distinguish a supportable value from management affordability.
- Free indicative business valuation — for owner planning, not formal reliance.
- Business valuation methods — compare the approaches that may inform a professional assessment.
- Valuation methodology and limitations — understand how planning tools differ from an instructed opinion.
This guide is general information, not legal, tax, accounting or valuation advice for your particular circumstances. Specialist requirements and the suitability of any instruction must be assessed separately.
Questions & Answers
Do I need a formal valuation or the free indicative valuation?
The free indicative valuation is for owner planning and exploring what a business may be worth from manually entered information. It is not independently verified and its six-page summary is not a formal report. If the figure is needed for HMRC or EMI, probate, court or divorce proceedings, a shareholder matter, EOT trustee reliance, lending, financial reporting or another formal purpose, request an adviser assessment instead. Explain who needs the value and why. You do not need to complete the calculator first, and the assessment can help identify the appropriate scope before you commission work.
Which formal valuation purposes can I ask about?
You can ask about EMI or HMRC share valuation, tax planning and share transfers, probate or estate administration, divorce or court proceedings, shareholder disputes, shareholder departure including retirement, resignation or death, EOT transactions, lending, financial reporting, and a planned sale with adviser review. Each requires its own assessment of subject, date, intended use and expertise. A shareholder leaving following death is not automatically a probate instruction. If your situation overlaps several purposes or does not fit this list, describe it in the enquiry so the team can clarify what is actually required.
What will the service and report include?
The agreed engagement defines the service. It will establish the valuation subject, date, purpose, intended users and basis, and identify the information and analysis needed. The written report should explain the methods, evidence, material assumptions, limitations and conclusion, with relevant financial or share-rights analysis where appropriate. Not every instruction needs the same methods or a fixed number of pages. Specialist advice, authority negotiations, additional updates and court attendance are not automatically included. Check the written scope for the deliverables, permitted reliance, fees and timetable before accepting an engagement.
What happens after I request an assessment?
The enquiry is a request to discuss suitability and scope, not an instruction to begin work. Our team reviews what you have described, then discusses the intended use, the interest being valued, the relevant date and who needs to rely on the report. From there, the appropriate next step may be an adviser-prepared valuation, a specialist instruction through our partner network, clarification from your existing professional advisers, or further preparation before a report can be scoped. If an engagement is agreed, the scope, fee and timetable are confirmed in writing before substantive work begins. No fee is accepted and no report work starts before that scope is agreed.
How much does a formal valuation cost and how long does it take?
The fee and timetable are agreed after the scope has been assessed. They depend on the business, the interest being valued, financial records, share structures, valuation date and the needs of the receiving party. Historic valuations, incomplete records or expert evidence may require additional work. The initial enquiry does not accept a fee or commission a report. Tell us about any deadline at the outset and ask for written confirmation of what is achievable. This guide does not promise a standard price, fixed turnaround or urgent availability for every situation.
When is the fee agreed and paid, and what if the scope changes?
The fee is set out in the written scope, together with the deliverable, timetable, responsibilities and permitted reliance, before substantive work begins; the initial enquiry creates no fee. If further work becomes apparent during the assessment, such as additional accounting periods, more detailed share-rights analysis or specialist expert input, the adviser should explain the effect on fee and timing and confirm any revised scope in writing before continuing. Questions about payment should be settled at the scoping stage rather than assumed. If you have a fixed filing, hearing or transaction deadline, raise it before the scope is agreed so achievable timing is confirmed rather than assumed.
Will a formal report guarantee HMRC, court or lender acceptance?
No. A report must be prepared for the intended purpose, but the receiving authority, court, lender or other party can ask questions, require more evidence or reach a different view. No acceptance, tax treatment, relief eligibility or transaction outcome is guaranteed. Some recipients require a particular adviser or instruction format, so check those requirements before commissioning work. A report for one purpose is not automatically suitable for another. The scope should also explain whether responses to subsequent queries are included or require a separate agreement.
What do I need to send when requesting an assessment?
Begin with a short description of the business, the valuation purpose, the shares or business interest involved, the relevant date if known and any deadline. Explain who will use the report and whether a solicitor, accountant, trustee or lender is already involved. You do not need to send a complete financial pack in the first enquiry. Following the discussion, the adviser can specify the records needed and the agreed way to provide them. If information is missing or the position is disputed, say so early so the proposed scope reflects those limitations.
What evidence will the assessment rely on?
The evidence depends on the subject, purpose and valuation date. For an earnings-based assessment, recent statutory and management accounts, trading trends and support for proposed adjustments to reported profit are typical starting points. For a share valuation, the articles, shareholder agreement, share register and details of options or different share classes may be needed, and a historic date requires records covering the relevant period. Adjustments are considered in context rather than accepted simply because they change profit, and forecast assumptions are examined rather than taken at face value. If records are incomplete, say so early: the adviser can explain what can still be assessed and whether limitations would make the intended report unsuitable, so the scope is set realistically before anyone relies on the conclusion.
Can you work to a fixed deadline or a historic valuation date?
Both arise frequently, but neither should be assumed straightforward. A valuation speaks to a particular date, so a historic tax event, death or share transfer may need records and market conditions from that earlier period rather than today's trading position. A fixed filing, hearing or transaction deadline affects the evidence required and the achievable sequence of work, so it must be known before the scope is agreed. Give the date and the deadline in your initial enquiry and ask for written confirmation of what is achievable. Urgent availability cannot be promised for every situation, and a rushed report is not a substitute for evidence that supports the conclusion.
Can I use the valuation as my expected sale price?
A formal valuation is a reasoned opinion for its stated purpose and date, not an offer to buy the business or a guaranteed selling price. A tax, accounting or contractual share valuation may answer a different question from a sale negotiation. Actual proceeds can change with buyer interest, funding, diligence, business performance, deal structure and timing. If sale planning is your purpose, say so when requesting the assessment. The adviser can explain the distinction between business value, shareholder value and the commercial terms that determine the amount ultimately received.