Ask an expert: expenditure incurred for corporate intangibles reinvestment relief

Q: My corporate client sold its business and assets (including goodwill) in July 2009. The company had commenced to trade before 2002. The goodwill which had a nil base cost was sold for £1m and the company filed a provisional claim to roll over the capital gain against a new corporate intangible asset. My client is now considering purchasing a trademark costing £1.2m. The main concern in relation to securing rollover relief against this investment is that the purchase will not be cash upfront – an unconditional contract will be signed shortly before the three-year rollover deadline with the purchase consideration consisting of £600 000 in cash and the balance payable in instalments over a specified period. Will the whole of the purchase price be treated as ‘incurred’ within the three-year window for rollover relief purposes?