§ 50. Sir J. Leechasked the Chancellor of the Exchequer whether he will, when rearranging the working of the Income Tax law, include a Clause in the Finance Bill to abolish the right to claim refund of personal allowances in cases where emoluments have been received by directors, managing directors, or servants of a limited liability company tax free or free of tax?
§ The Chancellor of the Exchequer (Sir John Simon)No, Sir. Income Tax paid by a company in respect of directors' or employés'remuneration is regarded for Income Tax purposes as additional remuneration of the director or employé and is assessed as such. In effect, therefore, the tax is paid out of the director's or employé's income for Income Tax purposes and unless the personal allowances to which the director or employé is entitled have already been taken into account they can properly be claimed by way of repayment.