§ COLONEL LOCKWOOD (Essex, Epping)
To ask Mr. Chancellor of the Exchequer if it is customary to charge income tax on a source of income that has not been received within the year of assessment, and which, owing to the possibilities of commercial speculation, may never be paid; and will he say in what way income tax so paid could be recovered in the event of an undertaking failing to fulfil its obligations.
(Answered by Sir Michael Hicks Beach.)Speaking generally, income tax is by law chargeable upon income which arises or accrues during the year of assessment, even though it be not actually received within that period. If it can afterwards be shown that the income has not been, and will not be received, the assessment would be discharged, and any tax paid in respect of it would be refunded.