Cemeteries and crematoria
B5.620 Cemeteries and crematoria—overview
If revenue is derived from selling grave spaces in a cemetery the resulting profit is assessable as trading income whether or not the seller undertakes to maintain the graves.
In Edinburgh Southern Cemetery Co v Kinmont1, the company existed for the purpose of providing a cemetery, and it purchased an area of land which was vested in trustees in trust for the members of the company and for those who might become proprietors of burial places, tombs or graves in the cemetery. The company's revenue was obtained mainly from the sale of lairs or rights of burial, but the company also received fees for funerals and for certificates for dressing the grounds and other services. It was held that the company was carrying on a business and that the profit was assessable to tax. The court also decided that the company could not deduct, in computing its profits, the estimated cost price of each grave space sold, for such a deduction was in respect of the exhaustion of a capital asset. However, by what is now ITTOIA 2005, ss 169–172 (income tax) or CTA 2009, ss 146–149 (corporation tax), allowances in the form of deductions can be made in respect of certain items of capital cost, see below. The provisions do not apply where profits are calculated using the cash basis for small businesses from 2013/14 (see B2.112)2.
In another case, Paisley Cemetery Co Ltd v Reith3, a cemetery company charged for the upkeep
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