35Work in progress at discontinuance
(1)Where, in computing for any income tax purpose the profits or gains of a profession or vocation which has been discontinued, a valuation is taken of the work of the profession or vocation in progress at the discontinuance, that work shall be valued as follows—
(a)if the work is transferred for money or any other valuable consideration to a person who carries on or intends to carry on a profession or vocation in the United Kingdom, and the cost of the work may be deducted by that person as an expense in computing for any such purpose the profits or gains of that profession or vocation, the value of the work shall be taken to be the amount paid or other consideration given for the transfer;
(b)if the work does not fall to be valued under the foregoing paragraph, its value shall be taken to be the amount which would have been paid for a transfer thereof on the date of the discontinuance as between parties at arm's length.
(2)Subsection (2) of section one hundred and forty-three of the Act of 1952 (determination of questions arising on the valuation of trading stock sold when a trade is discontinued) shall apply to the determination of any question arising under paragraph (a) of subsection (1) of this section as it applies to the determination of any question arising under paragraph (a) of subsection (1) of that section, but with the substitution of references to professions and vocations for references to trades.
(3)Where a profession or vocation is discontinued and the person by whom it was carried on immediately before the discontinuance so elects, by notice in writing sent to the surveyor at any time within twelve months after the discontinuance, the amount, if any, by which the value of the work in progress at the discontinuance (as ascertained under subsection (1) of this section) exceeds the actual cost of the work shall not be brought into account in computing the profits or gains of the period immediately before the discontinuance, but the amount by which any sums received for the transfer of the work exceed the actual cost of the work shall be included in the sums chargeable to tax by virtue of section thirty-two of this Act as if it were a sum to which that section applies received after the discontinuance.
(4)The foregoing provisions of this section apply where a profession or vocation is treated under section nineteen of the Finance Act, 1953, as permanently discontinued as they apply in the case of an actual discontinuance, but shall not apply in a case where a profession or vocation carried on by a single individual is discontinued by reason of his death.
(5)For the purposes of section one hundred and forty-three of the Act of 1952 (valuation of trading stock on the discontinuance of trades) " trading stock ", in relation to a trade, includes any services, article or material which would, if the trade were a profession or vocation, be treated as work in progress thereof for the purposes of this section, and references to the sale or transfer of trading stock shall be construed accordingly.
(6)This section applies, and applies only, to discontinuances occurring after the fifth day of April, nineteen hundred and sixty.