BIM72050 | Cash basis: rules not applied in calculating profits

In calculating the profits of a trade using the cash basis, certain rules do not apply, and some claims and reliefs are not available.

Claims, elections and reliefs not available when using the cash basis:

• Herd basis rules (see BIM55501)

• Averaging profits of farmers and creative artists (see BIM84050)

• Compensation for compulsory slaughter of animals (see BIM55180)

• Relief for unremittable amounts

Special rules not applied in calculating profits on the cash basis:

• Sound recordings (see BIM56200)

• Certain telecommunication rights (Chapter 9 or Part 2 ITTOIA 2005)

• Long-funding leases (Chapter 10A of Part 2 ITTOIA 2005)

• Changes in trading stock (see BIM33630)

• Disposal and acquisition of know-how (Chapter 14 of Part 2 ITTOIA 2005)

• Oil activities (Chapter 16A of Part 2 ITTOIA 2005)