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HMRC internal manual

Business Income Manual

DVD and blu-ray disc traders: contents

This section looks at the taxation of traders offering DVDs and blu-ray discs for hire.

The tax treatment of similar items (such as computer and console games) follows the same lines.

Acquisition for resale

A DVD/blu-ray disc acquired primarily for resale at a profit is simply stock in trade. The cost of the DVD/blu-ray disc is a revenue expense. Any stock at the period end should be valued in accordance with BIM33100 onwards.

Acquisition for hiring out

A DVD/blu-ray disc acquired for hiring out should not be treated as stock, even if it is to be sold at the end of its useful life.

The following sections look at the ways in which relief for the cost of acquiring hire DVDs/blu-ray discs is available. Whichever basis is used should be followed consistently from year to year.

Where the issue is one of timing, you should consider the tax ultimately at issue when deciding how far to pursue enquiries.