Section EB 2 — Income Tax Act 2007: Meaning of trading stock

EB 2 Meaning of trading stock Meaning (1) Trading stock means property that a person who owns or carries on a business has for the purpose of selling or exchanging in the ordinary course of the business. Inclusions (2) Trading stock includes— (a) work of the following kinds that would be trading stock under subsection (1) if it were completed: (i) partly completed work: (ii) work in progress: (b) materials that the person has for use in producing trading stock: (c) property on which the person has incurred expenditure, when the property would, if they had it, be trading stock under subsection (1) or paragraph (a) or (b): (d) property leased under a hire purchase agreement when the property— (i) is treated as having been acquired by the lessor under section FA 15 (Treatment when agreement ends: seller acquiring property); and (ii) is an asset of a business that the lessor carries on. Exclusions (3) Trading stock does not include— (a) land: (b) depreciable property: (c) a financial arrangement to which the financial arrangements rules or the old financial arrangements rules apply: (d) an excepted financial arrangement that a life insurer has: (e) an excepted financial arrangement held by a person if section CX 55 (Proceeds from disposal of investment shares) applies to the income of the person from a disposal of the excepted financial arrangement: (f) livestock not used in a dealing business: (g) consumable aids to be used in the process of producing trading stock: (h) a spare part not held for sale or exchange: (i) an emissions unit: (j) a non-Kyoto greenhouse gas unit. Defined in this Act: business , depreciable property , emissions unit , excepted financial arrangement , financial arrangement , hire purchase agreement , income , land , lessor , life insurer , non-Kyoto greenhouse gas unit , , trading stock Compare: 2004 No 35 s EB 2 Section EB 2(3)(e): amended, on 1 April 2010, by section 112(1) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section EB 2(3)(h): amended, on 26 September 2008, by section 72(1) of the Climate Change Response (Emissions Trading) Amendment Act 2008 (2008 No 85). Section EB 2(3)(i): substituted (with effect on 1 January 2009), on 6 October 2009, by section 112(2) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section EB 2(3)(j): added (with effect on 1 January 2009), on 6 October 2009, by section 112(2) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section EB 2 list of defined terms emissions unit : inserted (with effect on 1 January 2009), on 6 October 2009, by section 112(3)(b) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section EB 2 list of defined terms ETS unit : repealed (with effect on 1 January 2009), on 6 October 2009, by section 112(3)(a) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34). Section EB 2 list of defined terms non-Kyoto greenhouse gas unit : inserted (with effect on 1 January 2009), on 6 October 2009, by section 112(3)(b) of the Taxation (International Taxation, Life Insurance, and Remedial Matters) Act 2009 (2009 No 34).