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HMRC internal manual

Business Income Manual

Farming: stock valuation: working horses

S30 Income Tax (Trading and Other Income) Act 2005, S50 Corporation Tax Act 2009

Working horses may be treated either as stock-in-trade or as a fixed capital asset. Where the latter basis is adopted the cost of a home bred horse added to working horses may be estimated at 85% of its current market value. Any attempt to treat working horses for taxation purposes as stock-in-trade in one year and as a fixed capital asset in another should be resisted.