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SPECIMEN CASES 77
£74. K. S. derives his income entirely from invest-
Tents paid at various dates during the year, and
1 ceives £1,300 in cash between April 5th, 1918, and
+ pril 5th, 1919. Some of the dividends are paid for
{ le six months ending June 30th and December 31st,
+ | the June dividends are really made up of 1917-18
i=iofits (say January 1st to April 5th), and 1918 profits
Tom April 6th, 1918, to June 30th, 1918. The
lilway company, or whatever it is, in paying the
* ine dividend, calculates the tax at the rates in force
of iring the first six months on the first portion of it
£ the 1917 rate of 5s.,and on the second part at 6s.,
+ 1d deducts tax from the June dividend at the mean
ite of bs. 57d. The second (December) dividend
+ is tax deducted at 6s. in the £.
{ ‘Taking the figures so shown on the dividend war-
nts, he finds that his gross income is, say, £1,823.
i he difierence between that and £1,300, the cash
4 ceived—viz., £523—is, therefore, the tax he has
{ yparently paid. (It may here be stated that there
"no general rule making it binding on any company
* | stop tax at this very exact rate. Scottish railway
{ impanies do, reckoning the number of days during
1 hich different rates of tax were in force, and so do
{me other companies. English railway companies
*! fually reckon by months, and in the particular case
+ ven would deduct at 5s. 6d.)
+t The company, however, has paid tax on its entire
1 ofits for the year 1918-19 at 6s. in the £, and the
*! lareholder has, of course, contributed his share of
1 le tax at this rate.
*l Taking his net income at £1,300, this represents,
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