Farmers Flashcards
1
Q
Farmers
When is Averaging Unavailable to Claim?
A
In the First and Final Years of Trading.
2
Q
Farmers
Averaging is Available to Claim Where:
A
- Lower Profits < 75% of Higher Profits;
- Profits are Calculated Under the Accruals Basis.
3
Q
Farmers
When Must an Averaging Claim be Made?
A
Anniversary of 31 January Following the Later Tax Year.
4
Q
Farmers
What is the Effect of a Herd Basis Election?
A
Animals are Treated as Fixed Assets Rather Than Trading Stock.
5
Q
Farmers
The Main Benefits of a Herd Basis Election is That:
A
- Maintenance Costs are Tax-Deductible;
- Eventual Disposal Proceeds are Tax-Free.
Animals are ‘Wasting Chattels’ for CGT Purposes
6
Q
Farmers
Selling Part of a Herd is a Trading Receipt Where:
A
- No More Than 20%of the Herd is Sold;
- No Replacement Animals are Purchased.
7
Q
Farmers
When Must a Herd Basis Election be Made?
A
The Anniversary of 31 January Following the Tax Year the Production Herd is Kept.
The Deadline is Extended by a Year if Trading Started in the Year of Purchase.
