Précis of Decision. A British subject born in Calcutta had A British subject who for many years (1) Under its Articles of Association the 29th Nov., King's 48 T.L.R. 160. management of a British company of 1926. 7th Feb., Bench Court of Appeal. [1927] K.B. 719. C 2 Name of Case. Martin v. Lowry (H.M. Lothian Chemical Co., Kirke's Trustees v. V. Commissioners of In- Marshall v. Tweedy (H.M. Inspector of Taxes). A Précis of Decision. wholesale agricultural machinery merchant who had purchased from the the Government its surplus stock of aeroplane linen, having failed to sell the whole of it to linen manufacturers in bulk, set up a selling organisation and disposed of the whole of the linen in portions within a period of some seven months. Held that his dealings in the linen constituted the carrying on of a trade of which the profits were chargeable to Income Tax. A company was up till June, 1917, manu- A repayment of Excess Profits Duty made 9th Dec., 1926. 14th Dec., 15th Dec., 17th Dec., Commissioners of Inland Revenue V. Livingston and others. Commissioners of Inland Revenue V. Falkirk Temperance Café Trust. Ingle V. Farrand (H.M. Inspector of Taxes). A ship repairer, a blacksmith and a fish salesman purchased as a joint adventure a cargo vessel with a view to its conversion into and sale as a steam drifter. The two former were employed on the work at the ordinary trade rates, and on the completion of the repairs and alterations the vessel was sold at a profit. Held that the Respondents were assessable to Income Tax under Case I of Schedule D in respect of this profit. A testator bequeathed one half of the residue of his estate in trust to be used for providing Falkirk with a temperance public house or houses. The trustees purchased a hotel which they reconstructed and furnished as a temperance hotel and café. The café was in two sections, one for the middle classes where meals were provided at ordinary rates and the other for the poorer classes where lower prices were charged; the premises also included reading and recreation rooms where newspapers and periodicals were supplied free of charge, and bedrooms, bathrooms and a lecture room which could be hired. The balance of the share of residue was invested in name of the trustees. The café was run at a loss which was made good out of the income of the invested funds, the policy of the trustees being to charge only such prices as would avoid a trading deficiency in excess of the income from investments. Held that the trust was one established for charitable purposes only within the meaning of Section 37 (1) (b) of the Income Tax Act, 1918, that the income had been applied to such purposes only, and that the trust was accordingly entitled to exemption from Income Tax in respect of such income. An additional assessment to Income Tax under Schedule E for the year 1921-22 was made, after the 1st May, 1922, upon a Second Class Assistant in the employ of the London County Council in respect of the excess of his actual remuneration for that year over the amount of the original Schedule E assessment made upon him for that year. Held that, as the original assessment under Schedule E exceeded the amount upon which he should have been assessed under Schedule D on the three years' average basis as not holding a public office or employment, there had been no undercharge for the year in question and the additional assessment could not be supported. (29598) C3 INCOME TAX-STATISTICS, ETC. 42. The amount included for Income Tax in the Budget Estimate for 1926-27 was £254,800,000, and the Exchequer Receipt amounted to £234,717,000, showing a deficit of £20,083,000. The Gross Receipt of tax in the year amounted to £273,912,916, and the repayments to £43,777,048 leaving a Net Receipt of £230,135,868. The Budget Estimates, Exchequer Receipts and Net Receipts in 1926-27 and the ten preceding years are as follows: Table 43.-Budget Estimate, Exchequer Receipt, and Net Receipt. 43. The standard rate of Income Tax in force for the year 1926-27 was 4s. in the £. The personal allowances, deductions and reliefs granted to individuals are shortly summarised below. Table 44.-Taxation in force for the Years 1920-21 to 1926-27. The following allowances, deductions and reliefs were granted to individuals, the age allowance only being contingent upon the total amount of the income:Earned Income Allowance Age Allowance, to individuals aged 65 years or upwards whose total income does not exceed £500. Personal Allowance 1920-21 to 1924-25, one tenth of the earned income, not exceeding £200 for any individual. 1925-26 and 1926-27, onesixth of the earned income, not exceeding £250 for any individual. 1925-26 and 1926-27, one sixth of such total income. Married persons, £225; Other persons, £135. Increased Personal Allowance where Wife has Up to £45. earned income. Widower's or Widow's Housekeeper taking care of children. 1920-21 to 1923-24, £45. 1924-25 to 1926–27, £60. Widower's or Widow's Housekeeper Unmarried person's widowed mother taking care of 1920-21 to 1923-24, £45; children. 1924-25 to 1926-27, £60. Children under 16 years of age, or over 16 if continu- £36 for one child and £27 ing full-time education. for each subsequent child. Certain Dependent Relatives incapacitated by old £25 for each such relative. age or infirmity. Rates of Tax in the £ Chargeable on the Taxable Income. 44. The following table illustrates the graduation of the tax for representative incomes and taxpayers:— (29598) C 4 |