Commentary

B5.151 Nature of herd

Business tax
Business tax | Commentary

B5.151 Nature of herd

Business tax | Commentary

B5.151 Nature of herd

Farm animals have the characteristics of machines in that they convert grass into milk or wool. If a farmer who does not calculate his profits on the cash basis elects (see B5.152) for the herd basis to apply to a production herd (see below), the animals in that herd form part of his fixed capital for tax purposes in the same way as plant and machinery; this does not mean that the herd can qualify for capital allowances1. It cannot apply to working horses or working dogs; or to animals kept for public exhibition or racing or other competitive purposes. It cannot apply to 'flying flocks', that is, sheep or cattle held for resale, even though these beasts may produce milk,

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