The text on this page has been created from Hansard archive content, it may contain typographical errors.
56.
Sir J. D. REES
asked the Chancellor of the Exchequer whether bonus shares, resulting from the capitalisation of undistributed profits, are treated as income or as capital in respect of taxation?
Mr. BONAR LAW
It is a fundamental principle of the Income Tax Acts to charge Income Tax upon all profits at the source whether they are distributed or not. As regards bonus shares issued in respect of accumulated taxed profits, the question whether they fall to be included in the computation of the total income of the person receiving them is one which can only be determined by reference to the particular facts.