[F197ACash basis: value of trading stock on cessation of tradeU.K.
(1)This section applies if—
(a)a person permanently ceases to carry on a trade in a tax year, and
(b)an election under section 25A (cash basis for small businesses) has effect in relation to the trade for the tax year.
(2)The value of any trading stock belonging to the trade at the time of the cessation is brought into account as a receipt in calculating the profits of the trade for the tax year.
(3)The value is to be determined on a basis that is just and reasonable in all the circumstances.
(4)If there is a change in the persons carrying on a trade, subsection (2) does not apply in relation to the trade so long as a person carrying on the trade immediately before the change continues to carry it on after the change.
(5)In this section “trading stock” has the same meaning as in Chapter 12 (see section 174).
(6)This section does not apply to professions or vocations.]
Textual Amendments
F1Ss. 97A, 97B and cross-heading inserted (with effect in accordance with Sch. 4 paras. 56, 57 of the amending Act) by Finance Act 2013 (c. 29), Sch. 4 para. 21