Stock relief
26/03/1990
Query
Does the definition of trading stock for the purposes of stock relief include such items as fertilisers, pesticides, purchased feeds, home produced feeds, diesel and machinery parts?.
Decision
The definition of trading stock in Section 89 Taxes Consolidation Act 1997 includes "materials such as are used in the manufacture, preparation, or construction of property such as is sold in the ordinary course of that trade". Stock relief should therefore be allowed on items which are inputs to the property which is sold in the ordinary course of the business (e.g. feed, fertiliser, seeds, etc). It should not be allowed on expense stocks such as machine parts, diesel etc.
Income Tax
Section 665, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT903005
28/11/1995
Query
Does the 100% stock relief apply to stock which has been disposed of due to B.S.E. ?.
Decision
Cattle which have been disposed of due to Bovine Spongiform Encephalopathy (BSE) are regarded as cattle compulsorily disposed of under a statute relating to the eradication or control of diseases in livestock for the purposes of the definition of “stock to which this section applies” in Section 668(1) Taxes Consolidation Act 1997.
Income Tax
Section 668, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:GD90.112
20/05/1996
Query
Is a young farmer regarded as being a holder of a qualification in the year he completes his Teagasc course or in the year he recevies his certificate?.
Decision
An individual would be regarded as holding a qualification once he has been conferred with a degree/diploma or presented with a certificate. The Certificate in Farming qualification is presented in September or October each year.
Income Tax
Section 667, Taxes Consolidation Act, 1997
Origin: RLS Division
File ref:IT963010
05/09/2001
Query
Taxpayer received BSE compensation and elected under section 668 of the Taxes Consolidation Act, 1997 to have the excess treated as arising in each of the 2 immediately succeeding accounting periods on a 50/50 basis for the years ended 31 March 2000 and 31 March 2001. Taxpayer successfully restocked during the year ended 31 March 2000 but was prevented from doing so during the year ending 31 March 2001 due to the onset of foot and mouth disease.
Decision
As the difficulties which prevented the taxpayer restocking were due to foot and mouth disease and could not have been provided for under the provisions of Section 668. The taxpayer was allowed to concessionally: have the second installment of the profit on disposal of cattle from BSE compensation normally taxable in the year ending 31 March 2001 to be deferred and taxed in the following year ending 31 March 2002. The taxpayer was entitled to the balance of the stock releif in respect of his accounts to year ending 31 March 2002.
Income Tax
Section 668, Taxes Consolidation Act, 1997
Origin: Direct Taxes International and Administration
File ref:PTU 4924