Section 109 — Corporation Tax Act 2009: Election for application of herd basis rules

Election for application of herd basis rules 109 1 A company, or a firm of which a company is a member, which keeps or has kept a production herd for the purposes of a trade may make an election under this Chapter (a “herd basis election”).

2 In calculating the profits of the trade, animals which are part of a production herd in relation to which a herd basis election has effect—

a are not treated as trading stock (see section 50), but b are treated instead in accordance with sections 112 to 121 (“the herd basis rules”).

3 This Chapter is expressed in terms of farmers but applies to any company, or firm of which a company is a member, which keeps or has kept a production herd for the purposes of a trade, whether or not the trade is farming.

4 References in this Chapter to keeping a production herd are to keeping it for the purposes of the trade.