Commentary

B5.154 Herd basis—deciding whether to elect

Business tax
Business tax | Commentary

B5.154 Herd basis—deciding whether to elect

Business tax | Commentary

B5.154 Herd basis—deciding whether to elect

The decision whether to elect for the herd basis may not be an easy one, for there will usually be a range of factors:

  1.  

    (a)     The greater the difference between the cost of animals in the herd and their ultimate market value, the greater the advantage of the herd basis. The difference will be greatest for pedigree beasts. There will usually be a useful difference in the case of a home bred, good quality herd. If, on the other hand, high quality beasts are bought in at full market prices, the difference between cost and market value is likely to be smaller, and the advantage of the herd basis correspondingly reduced.

  2.  

    (b)     The larger the herd, the more important the question of the

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