Commentary

B5.150 Introduction to herd basis

Business tax
Business tax | Commentary

B5.150 Introduction to herd basis

Business tax | Commentary

Herd basis

B5.150 Introduction to herd basis

In the section above dealing with the treatment of farm animals (see B5.135–B5.142), the distinction between fixed capital and circulating capital was discussed. In this section, the rules for treating animals as fixed capital are explained in detail1. The questions to be considered are—How to secure this apparently attractive basis? What are the effects whilst the basis is in operation? What is the effect at the end of the day, when the herd comes to be sold, or when the farm itself is disposed of, or when the

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