§ MR. W. F. D. SMITH (Strand, Westminster)To ask Mr. Chancellor of the Exchequer whether, if it can be shown that an individual owns all the ordinary shares in a limited company and gives the whole of his time to the management and business of that company, and is dependent for the whole of his income upon the dividends paid by the business, he can claim a reduction upon earned income under the Act of 1907.
(Answered by Mr. Lloyd-George.) Only so much of the profits of a limited company as the articles of association provide as remuneration for services to the company, and as are actually so paid according to the accounts, can be regarded as earned income within Section 19 of the Finance Act, 1907.