Finance Act, 1974
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Allowance of interest as a business expense. |
40.—(1) In computing for the purposes of tax for the year 1974-75 or any subsequent year of assessment the profits or gains arising from a trade or profession in a basis period falling wholly or partly before the 10th day of January, 1974, there may, subject to section 61 of the Income Tax Act, 1967 , be deducted— | |
(a) the gross amount of any annual interest paid under deduction of tax before the 10th day of January, 1974, in respect of a period ended before that date, and | ||
(b) the amount of any interest paid to a bank or a person carrying on business as a member of a stock exchange or of a discount house relief for which was allowed under section 496 of the Income Tax Act, 1967 , for the year of assessment in which the interest was paid. | ||
(2) In this section “basis period” in relation to any year of assessment means the period the profits or gains of which are taken into account in charging tax under Case I or Case II of Schedule D on the profits or gains of the trade or profession for that year of assessment. | ||
(3) It is hereby declared that, subject to subsection (1), relief in respect of any payment of interest shall not be given under the said section 496 and in computing the profits or gains of a trade or profession. |