Corporation Tax Act 2009 section 127C

Book value

Section 127C defines what is meant by the "book value" of an animal for the purposes of calculating the profit or loss arising when livestock is compulsorily slaughtered and compensation is received.

• The book value of a slaughtered animal is normally the value shown in the accounts at the start of the accounting period in which it was slaughtered.
• If no value appears in the accounts because the animal was born and slaughtered in the same accounting period (and was not acquired as trading stock in any other way), the book value is 75% of the compensation payable for that animal.
• If the animal entered trading stock through a transfer from the trader's own use or through an acquisition not made in the course of trade, the book value is the deemed cost figure that applies under those rules.
• In all other cases where no value is shown in the accounts, the book value is simply the cost of acquiring the animal for the purposes of the trade.