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Income Tax

Volume 486: debated on Tuesday 10 April 1951

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11. Charge of Income Tax for 1951–52

Resolved:

That—

(1) income tax for the year 1951–52 shall be charged at the standard rate of nine shillings and sixpence in the pound and, in the case of an individual whose total income exceeds two thousand pounds, shall be charged in respect of the excess at rates in the pound which respectively exceed the standard rate by the amounts specified in the second column of the following Table:—

TABLE
For every pound ofsd.
the first five hundred pounds of the excess20
the next five hundred pounds of the excess26
the next one thousand pounds of the excess36
the next one thousand pounds of the excess46
the next one thousand pounds of the excess56
the next two thousand pounds of the excess66
the next two thousand pounds of the excess76
the next two thousand pounds of the excess86
the next three thousand pounds of the excess96
the remainder of the excess100

(2) All such enactments as had effect with respect to the income tax charged for the year 1950–51 shall have effect with respect to the income tax charged for the year 1951–52;

(3) the amounts of tax which under section two of the Income Tax (Employments) Act, 1943, fall to be deducted or repaid before the twenty-fifth day of May, nineteen hundred and fifty-one, shall be computed by reference to the standard rate of tax for the year 1950–51, but nothing in this paragraph shall prevent the resulting under-deductions and over-repayments of tax from being adjusted subsequently by means of increased deductions or diminished repayments under the said section two, or, if need be, by an assessment.

And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913.

12. Higher Rates of Income Tax for 1950–51

Resolved:

That income tax for the year 1950–51 shall be charged, in the case of an individual whose total income exceeded two thousand pounds, at the same higher rates in respect of the excess over two thousand pounds as were charged for the year 1949–50.
And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913.

13. Personal Reliefs, etc.

Resolved:

That—
  • (1) in subsection (2) of section forty of the Finance Act, 1927 (which, as amended by section seventeen of the Finance (No. 2) Act, 1945, section twenty-eight of the Finance Act, 1948, and section twenty-four of the Finance Act, 1950, provides for the relief from income tax commonly known as the reduced rate relief), the words "thirteen-nineteenths" shall throughout be substituted for the words "thirteen-eighteenths" and the words "eight-nineteenths" shall throughout be substituted for the words "four-ninths";
  • (2) in section eighteen of the Finance Act, 1920 (which, as amended by subsequent enactments, provides, amongst other things, for a deduction, in the case of married persons, of tax on one hundred and eighty pounds), the words "one hundred and ninety pounds" shall be substituted for the words "one hundred and eighty pounds";
  • (3) in subsections (1) and (3) of section twenty-one of the Finance Act, 1920 (which, as amended by subsequent enactments, provides for a deduction of tax on sixty pounds in respect of each child with an income of sixty pounds or less), the words "seventy pounds" shall be substituted for the words "sixty pounds";
  • (4) in subsection (1) of section sixteen of the Finance Act, 1943 (which, as amended by subsection (4) of section fifteen of the Finance Act, 1947, provides, amongst other things, that the deduction of tax allowable in certain cases in respect of a relative of the claimant or of his or her wife or husband who is maintained by the claimant is limited to cases where the total income of the person maintained does not exceed one hundred and twenty pounds a year and that the allowance is reduced if the total income of that person exceeds seventy pounds a year) the words "one hundred and thirty pounds" shall be substituted for the words "one hundred and twenty pounds" and the words "eighty pounds" shall be substituted for the words "seventy pounds";
  • (5) in subsection (2) of section nineteen of the Finance Act, 1935 (which, as amended by subsequent enactments, limits the tax on incomes exceeding one hundred and thirty-five pounds but less than one hundred and sixty pounds to one quarter of the excess) the words "three-tenths" shall be substituted for the words "one-quarter";
  • Provided that the changes effected by this Resolution shall not affect the amounts of tax deductible or repayable under section two of the Income Tax (Employments) Act, 1943, before the twenty-fifth day of May, nineteen hundred and fifty-one, but nothing in this proviso shall prevent the resulting under-deductions, over-deductions, under-repayments and over-repayments of tax from being adjusted subsequently by means of increased or diminished deductions and repayments under the said section two, or, if need be, by an assessment.
    And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913.

    14. Treatment for income tax purposes of new sources of investment income, etc.

    Resolved:

    That it is expedient to authorise such additional charges to income tax as may result from the substitution of a new provision for that contained in proviso (ii) to section thirty of the Finance Act, 1926 (which relates to cases where a person acquires, or is treated as having acquired, a new source of profits or income or an addition to an existing source).

    15. Income Tax on Foreign dividends, etc.

    Resolved:

    That—
  • (1) in paragraph (1) of Rule 7 of the Miscellaneous Rules applicable to Schedule D (which provides for the taxation by deduction of, amongst other things, interest, dividends, or other annual payments payable out of or in respect of the stocks, funds, shares or securities of any foreign or colonial company, society, adventure or concern) for the words "any foreign or colonial company, society, adventure or concern" there shall be substituted the words "any body of persons not resident in the United Kingdom";
  • (2) neither sub-paragraph (a) nor sub-paragraph (b) of the said paragraph (1) shall extend to any payment to which Rule 19 or Rule 21 of the General Rules applies;
  • (3) any reference in any provision of the Income Tax Acts to the said Rule 7 shall be construed as a reference to the said Rule 7 as amended by the preceding provisions of this Resolution;
  • (4) this Resolution shall have effect as from the tenth day of April, nineteen hundred and fifty-one, and shall also have effect and be deemed always to have had effect in relation to any payment made before that date from which a deduction of tax has been made which would, if this Resolution had been in force, have been a legal deduction.
  • And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913.

    16. Building Societies

    Resolved:

    That—
  • (1) if, as respects the year 1951–52 or any previous year of assessment, any arrangements are made (whether before or after the passing of this Resolution) between the Commissioners of Inland Revenue and a building society as respects the tax which is to be charged in the case of that society, being arrangements which purport to provide that no repayment of tax shall be made in respect of any income derived from investments with the society—
  • (a) tax shall not be deducted from any dividends or interest payable in that year in respect of shares in or deposits with or loans to that society and no assessment to tax or repayment of tax shall be made in respect of any such dividends or interest on or to the person receiving or entitled to the dividends or interest; and
  • (b) the amounts actually paid or credited in respect of any such dividends or interest (and no more) shall be treated as income for that year of the person entitled thereto; and
  • (c) the said amounts shall, in applying Rules 19 and 21 of the General Rules to other payments, be treated as profits or gains which have been brought into charge to tax,
  • so, however, that any such dividends or interest shall be taken into account for the purposes of assessment to surtax;
  • (2) any such arrangements made as respects any year of assessment shall, if made after the beginning of the year, be deemed to have come into force at the beginning thereof, and any necessary adjustments shall be made in relation to any sums paid or credited before the date of the making of the arrangements:
  • (3) in this Resolution—

    building society means a society incorporated under the Building Societies Act, 1874, or such an unincorporated society as is mentioned in section seven of that Act; and

    dividend includes any distribution, whether described as a dividend or other, which, apart from this Resolution, would fall to be treated as a dividend for the purposes of Rule 20 of the General Rules;

    (4) this Resolution shall apply in relation to a company within the meaning of the Companies Act, 1948, or the corresponding enactments in force in Northern Ireland, which carries on a business which, in the opinion of the Commissioners of Inland Revenue, is similar to that carried on by a building society as it applies in relation to a building society, except that the references to dividends and shares shall be deemed to be omitted.

    And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913.

    17. Income Tax: sales and other transactions between associated persons

    Resolved:

    That it is expedient to authorise such increases in the income tax payable by any person as result from provisions as to sales and other transactions of any kind where one of the parties has control over the other or some other person has control over them both.

    18. Staffs of High Commissioners, etc.—Income Tax

    Resolved:

    That the exemption from income tax conferred by section twenty-six of the Finance Act, 1925, on persons having or exercising employments to which section nineteen of the Finance Act, 1923, applies shall not extend and shall be deemed never to have extended to any person employed in any trade, business or other undertaking carried on for the purposes of profit.
    And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act, 1913.