Commentary on Sections Overview Overview Section 164: Basis of valuation of trading stock
610.This section introduces the five sections that follow. It is based on section 100 of ICTA. The corresponding rule for income tax is in section 175 of ITTOIA.
611.The five sections (including section 168 which defines “connected persons”) deal with the valuation of stock that is transferred to another trader. In each case, the requirement in section 100 of ICTA that the transferee carries on a trade is relaxed to include transfers to a person carrying on a profession or vocation. The income tax rules are amended to bring the income tax and corporation tax codes into line. See Change 39 in Annex 1.
612.Subsection (4) of this section deals with the case where the stock is not transferred to a person carrying on a trade, profession or vocation.