Part 2Trading income
Chapter 6Trade profits: receipts
F1Cash basis: value of stock and work in progress on cessation
97ACash basis: value of trading stock on cessation of trade
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.
Ss. 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