Explanatory Notes

Income Tax (Trading and Other Income) Act 2005

2005 CHAPTER 5

24 March 2005

Commentary on Sections

Part 2: Trading income

Chapter 8: Trade profits: Herd basis rules
Section 114: Initial cost of herd and value of herd

468.This section sets out the treatment of the initial cost, and value, of the herd. It is based on paragraph 3(2) of Schedule 5 to ICTA.

469.No deduction is allowed for the initial cost of the herd. Neither is the value of the herd taken into account in calculating the profits of the trade.