Corporation Tax Act 2009 section 160

Acquisitions not made in the course of trade

Section 160 establishes how to value trading stock that a company acquires outside the normal course of its trade, where the stock was not previously held by the trader themselves.

• When trading stock is acquired other than in the course of trade, and was not supplied by the trader themselves, a special valuation rule applies
• The cost of the stock for profit calculation purposes is its open market value at the date of acquisition, regardless of what was actually paid for it
• Any amount actually given in exchange for the stock is disregarded in calculating trade profits
• This rule is overridden by transfer pricing rules where those apply