INCOME TAX ASSESSMENT ACT 1997

CHAPTER 2 - LIABILITY RULES OF GENERAL APPLICATION  

PART 2-25 - TRADING STOCK  

Division 70 - Trading stock  

Subdivision 70-C - Accounting for trading stock you hold at the start or end of the income year  

Special valuation rules

SECTION 70-65   Working out the horse opening value and the horse reduction amount  

70-65(1)  
The horse opening value is:


(a) if the horse has been your *live stock ever since the start of the income year - its *value as *trading stock at the start of the income year; or


(b) otherwise - the horse's base amount (see subsection (3)).

70-65(2)  
The horse reduction amount is worked out as follows:


(a) for female horses under 12 years of age:


  Base amount    
Reduction factor  
×     Breeding days    
  Days in income year


(b) for any male horse:


Base amount × Nominated
percentage
×     Breeding days    
  Days in income year

70-65(3)  


In this section:

base amount
is the lesser of:


(a) the horse's *cost; and


(b) the horse's *adjustable value when it most recently became your *live stock.

breeding days
is the number of whole days in the income year since you most recently began to hold the horse for breeding.

nominated percentage
is any percentage, up to 25%, you nominate when you make the election in section 70-60 .

reduction factor
is the greater of:


(a) 3; and


(b) the difference between 12 and the horse's age when you most recently began to hold it for breeding.


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