Secretarial practice

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Monograph

Identifikator:: 1828236004

URN:: urn:nbn:de:zbw-retromon-249926

Document type:: Monograph

Title:: Secretarial practice

Edition:: fourth edition

Place of publication:: Cambridge

Publisher:: W. Heffer & Sons Ltd

Year of publication:: 1930

Scope:: viii, 987 Seiten

Digitisation:: 2022

Collection:: Economics Books

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Document type:: Monograph

Structure type:: Chapter

Title:: Chapter XXVI. Income tax in its application to trading companies

Collection:: Economics Books

324 SECRETARIAL PRACTICE is made, for the depreciation not yet allowed, 7.e. the differ- ence between the written-down value and what is realised as the scrap value. In this way, by the time a given machine 1s disposed of, the whole of the capital invested in it will have been allowed for against profits. This allowance for obsolete machinery is not however to exceed the cost of the new machinery, less the scrap value of theold. (Special conditions relate to wear and tear of plant rented, to plant on hire- purchase agreements, to ships, etc., details of which would be out of place in a general work, but which can be found in technical taxation manuals.) (3) Interest received which has been subjected to United Kingdom income tax, including mortgage and debenture inter- est, and all dividends. The amount to be deducted is either the gross or the net sum, whichever has been brought to credit of the account. If the gross sum has been brought in as a receipt, and the tax thereon charged as an expense, the disallowance of both will give the same effect. Bank deposit interest and other untaxed interest are often deducted also, and separately charged under Case III. of Schedule D, but it is not uncommon to let them remain in the general liability of the business. If there is a general interest account it will require scrutiny. Theoretically, the balance of the account should be brought into the computation, to be deducted from profit if the receipts are greater than the payments of interest in the year, and vice versa if they are less. This assumes that all the interest is annual, and consequently paid or received under deduction of tax. As the account commonly consists in the main of non-annual interest (e.g. trade interest, interest to or from bankers, or on bills), which is paid in full, and is there- fore assessable on the recipient, it is necessary to analyse the interest account to ascertain the true liability or claim to relief. The well-known case of Goslings and Sharpe v. Blake [ (1880), 23 Q.B.D. 324] sought to define ‘annual interest.’ In general it may be said that interest at varying rates and for periods less than a year is to be returned for tax by the banker, broker, or other lender, and not by the company, and that if evidence be produced to the inspector in support of the claim, allowance will generally be made. It follows that if any interest upon trade accounts, foreign invest- ments, &c., has been received without deduction of United Kingdom tax, such part of the revenue must not be deducted in computing the assessable profits. (4) Depreciation or wear and tear allowance is not taken off the profits, but is an allowance from the assess- ment. It represents the diminished value during the vear of

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