|
|
Super-tnx on undistributed income of certain companies
|
21. With a view to preventing the avoidance of the payment of super-tax through the withholding from distribution of income of a company which would otherwise be distributed, it is hereby enacted as follows:
|
|
| |
(1) Where it appears to the Special Commissioners that any company to which this section applies has not, within a reasonable time after the end of any year or other period ending on any date subsequent to the fifth day of April, nineteen hundred and twenty-two, for which accounts have been made up, distributed to its members in such manner as to render the amount distributed liable to be included in the statements to be made by the members of the company of their total income for the purposes of super-tax, a reasonable part of its actual income from all sources for the said year or other period, the Commissioners may, by notice in writing to the company, direct that for purposes of assessment to super-tax, the said income of the company shall, for the year or other period specified in the notice, be deemed to be the income of the members, and the amount thereof shall he apportioned among the members:
|
|
| |
Provided that, in determining whether any company has or has not distributed a reasonable part of its income as aforesaid, the Commissioners shall have regard not only to the. CLU-rent requirements of the company's business but also to such other requirements as may be necessary or advisable for the maintenance and development of that business.
|
|
| |
(2) Any super-tax chargeable under this section in respect of the amount of the income of the company apportioned to any member of the company, shall he assessed upon that memher in the name of the company, and, subject as hereinafter provided, shall be payable by the company, and all the provisions of the Income Tax Acts and any regulations made thereunder relating to super-tax assessments and the collection and recovery of super-tax shall, with any necessary modification, apply to super-tax assessments and to the collection and recovery of super-tax charged under this section.
|
|
| |
(3) A notice of charge to super-tax under this section shall in the first instance be served on the member of the company on whom the tax is assessed, and if that member does not within twenty-eight days from the date of the notice elect to pay the tax a notice of charge shall be served on the company and the tax shall thereupon become payable by the company :
|
|
| |
Provided that nothing in this subsection shall prejudice the right to recover from the company the super-tax charged in respect of any member who has elected as aforesaid but who fails to pay the tax by the first day of January in the year of assessment or within twenty-eight days of the date on which he so elected, whichever is later.
|
|
| |
(4) Any undistributed income which has been assessed and charged to super-tax under this section shall, when subsequently distributed, he deemed not to form part of the total income from all sources for the purposes of super-tax of any individual entitled thereto.
|
|
| |
Where a member of a company has been assessed to and has paid super-tax otherwise than under this section in respect of any income which has also been assessed and upon which super-tax has been paid under this section, he shall, on proof to the satisfaction of the Special Commissioners of the double assessment, be entitled to repayment of so much of the super-tax so paid by him as was attributable to the inclusion in his total income from all sources of the first-mentioned income.
|
|
| |
(5) Where super-tax is charged under this section in respect of the income of a company for any year or other period, the Commissioners of Inland Revenue shall, on a certificate from the Special Commissioners that (he super-tax has been accounted for, repay to the company the amount of any corporation profits tax paid by the company in respect of the corresponding accounting period or part thereof.
|
|
| |
(6) This section shall apply to any company—
|
|
| |
(a) which has, since the fifth day of April, nineteen hundred and fourteen, been registered under the Companies Acts, 1908 to 1917; and
|
|
| |
(b) in which the number of shareholders computed as hereinafter provided is not more than fifty; and
|
|
| |
(c) which has not issued any of its shares as a result of a public invitation to subscribe for shares; and
|
|
| |
(d) which is under the control of not more than five persons.
|
|
| |
For the purposes of this subsection—
|
|
| |
In computing the number of shareholders of a company there shall be excluded any shareholder who is a trustee or nominee for some person otherwise owning or beneficially interested in shares in the company, or who is an employee of the company, or is the wife or the unmarried infant child of a beneficial owner of shares in the company;
|
|
| |
A company shall be deemed to be under the control of any persons where the majority of the voting power or shares is in the hands of those persons or relatives or nominees of those persons, or where the control is by any other means whatever-in the hands of those persons;
|
|
| |
The expression “relative” means a husband or wife, ancestor, or lineal descendant, brother, or sister;
|
|
| |
The expression “nominee” means a person who may be required to exercise his voting power on the directions of, or holds shares directly or indirectly on behalf of, another person;
|
|
| |
Persons in partnership and persons interested in the estate of a deceased person or in property held on a trust shall, respectively, he deemed to be a single person.
|
|
| |
(7) In this section the expression “member” shall include any person having a share or interest in the capital or profits or income of a company, and the expression “ employee” shall not include any governing director, managing director, or director.
|
|
| |
(8) The provisions contained in the First Schedule to this Act shall have effect as to the computation of the actual income from all sources of the company, the apportionment thereof amongst members of the company, and otherwise for the purpose of carrying into effect, and in connection with, this section.
|
|
| |
(9) The provisions of this section shall apply for the purposes of assessment to super-tax for the year 1923–24 and any succeeding year of assessment.
|
