Revenue Precedents

Under the Brucellosis Eradication Scheme all female cattle and certain male cattle are required to be disposed of. A person may elect to avail of the 100% compulsory disposal stock relief in respect of them. Is the ordinary 25% stock relief available in respect of an increase in the stock which is not required to be disposed of? If a person elects to claim a 100% stock relief deduction under section 668 in respect of cattle compulsory disposed of, they are not entitled to a further deduction in respect of those cattle under section 666 for that year. 956

If a loss arises in a year as a result of an election made under this section is the loss available for set off against income? Yes – subject to the usual restrictions in section 662. IT953560

The section defines ‘relevant amount’ as the amount of income received as a result of a disposal of stock. In the context of this definition to what does the word ‘income’ refer? The reference to income in the definition is a reference to the total proceeds received in respect of the cattle which are compulsorily disposed of. GD94069A

Do the provisions of the section apply if a partial disposal of cattle held by a farmer takes place? No – partial disposals do not come within the provisions of the section, apart from those in relation to brucellosis as outlined in the section. GD94069

Taxpayer received BSE compensation and elected under section 668 of the Taxes Consolidation Act, 1997 to have the excess treated as arising in each of the 2 immediately succeeding accounting periods on a 50/50 basis for the years ended 31 March 2000 and 31 March 2001. Taxpayer successfully restocked during the year ended 31 March 2000 but was prevented from doing so during the year ending 31 March 2001 due to the onset of foot and mouth disease. As the difficulties which prevented the taxpayer restocking were due to foot and mouth disease and could not have been provided for under the provisions of section 668. The taxpayer was allowed to concessionally: have the second installment of the profit on disposal of cattle from BSE compensation normally taxable in the year ending 31 March 2001 to be deferred and taxed in the following year ending 31 March 2002. The taxpayer was entitled to the balance of the stock relief in respect of his accounts to year ending 31 March 2002. 946

Does the 100% stock relief apply to stock which has been disposed of due to B.S.E.? Cattle which have been disposed of due to Bovine Spongiform Encephalopathy (BSE) are regarded as cattle compulsorily disposed of under a statute relating to the eradication or control of diseases in livestock for the purposes of the definition of “stock to which this section applies” in section 668(1) Taxes Consolidation Act 1997.GD90.112