655 Farming and market gardening profits to be charged to tax under Schedule D

Summary

This is a general charging section under which farming and market gardening are to be treated in the same way as any other trade with profits being charged to tax under Case I of Schedule D.

Details

(1) Farming is to be treated as the carrying on of a trade, or part of a trade, and farming profits are chargeable to tax under Case I of Schedule D.

(2) Farming activities of a person, even though derived from different holdings or in different capacities (for example as sole owner of his/her own land and as a partner in other farming) are treated as a single trade. This is to apply despite anything to the contrary in Part 43 which deals with the taxation of partnerships. However, a farmer moving into or out of a farming partnership is subject to the same treatment as any other trader – that is, the commencement and cessation provisions in Chapter 3 of Part 4 apply.

(3) Market gardening is, in relation to the person by whom it is carried on, also treated as a trade and profits from market gardening are chargeable to tax under Case I of Schedule D.

Relevant Date: Finance Act 2021