§ 1. Paragraph 5 of the Ninth Schedule to this Act shall, with the necessary modifications, apply for the purpose of computing the value, at the end of the year, of any assets of a class described in the first column of the Table set out in that paragraph as it applies for the purpose of computing the value of those assets in the case of such a distribution as is mentioned in that paragraph.
§ 2. The amount of the debts due to the body corporate shall be taken to be reduced by the amount of such deductions, if any, as are allowable under paragraph (i) of Rule 3 of the Rules applicable to Cases I and II of Schedule D in computing the profits or gains of the body corporate for income tax purposes.
§ 3. The value of any hereditament in respect of which a value payment under the War Damage Act, 1943, has been made, or the value of which before and after the occurrence of any war damage has been determined for the purposes of such a payment, shall be taken to be equal to the amount paid in cash for the hereditament by the body corporate less the amount of the value payment, and, if the amount of the value payment is equal to or exceeds the first-mentioned amount, shall he taken to be nil.1625
§ 4. The value of any other assets shall he taken to be equal to the amount paid therefore in cash by the body corporate.
§ 5. The assets of the body corporate shall be deemed to include the amount, after deduction of income tax, of any unpaid post-war refund (within the meaning of Part IV of the Finance (No. 2) Act, 1945).
§ 6. The liabilities of the body corporate shall be deemed to include the following sums, whether or not they have become payable, that is to say—
- (a) any borrowed money or other debt owed by the body corporate;
- (b) any such sums in respect of accruing liabilities as are allowable as a deduction in computing profits or gains for income tax purposes, or would be so allowable but for the provisions of paragraph (1) of Rule 3 of the Rules applicable to Cases I and II of Schedule D; and
- (c) in the case of the business of an assurance company, also any sums representing profits of its life assurance business belonging or allocated to, or reserved for, or expended on behalf of, policy holders or annuitants (being sums which would be excluded, under subsection (1) of section sixteen of the Finance Act, 1923, in computing the profits of the company for income tax purposes).
§ 7. The liability at the end of the year in respect of income tax shall be taken to include any liability for income tax payable for the year of assessment ending on the fifth day of April next following the end of the year.
§ 8. The liability at the end of the year in respect of excess profits tax shall be taken to include any liability under an assessment made after the end of the year.
§ 9. The liability at the end of the year in respect of profits tax shall be taken to include any liability in respect of profits for any period ending at or before the end of the year.
§ 10. Where no balance sheet is drawn tip by the body corporate for the end of the year.—
- (a) the value of its assets at the end of the year shall be taken to be the same as at the last preceding date for which a balance sheet is drawn up by it, except that there shall be added to the value of those assets the amount, if any, which would be the amount of the undistributed profits of the body corporate for an accounting period beginning at the date for which the balance sheet is drawn up and ending at the end of the year, if in paragraph 1 of the Ninth Schedule to this Act—
- (i)for the amount referred to in paragraph (a) of sub-paragraph (2) there were substituted all the profits for the accounting period, and
- (ii) for the amount referred to in paragraph (c) of sub-paragraph (3) there were substituted the profits tax payable in respect of those profits; and
- (b) the value of its liabilities at the end of the year, other than liabilities in respect of any tax, shall be taken to be the same as at the last preceding date for which a balance sheet is drawn up by it, and its liabilities at the end of the year in respect of tax shall be as mentioned in paragraphs 7 to 9 of this Schedule, except that the liability in respect of profits tax shall be taken not to include liability in respect of profits for any period commencing after the date for which the balance sheet is drawn up.—[Mr. Boyd-Carpenter.]
§ Brought up, and read the First time.
§ Mr. Boyd-Carpenter
I beg to move, "That the Schedule be read a Second time."
This new Schedule is consequential upon an addition to the Bill at an earlier stage of my right hon. Friend the Chancellor's proposal to provide a further alternative standard for E.P.L. purposes based on net assets. The Schedule indicates the way in which the standard is to be ascertained. In substance, with one modification, it re-enacts the machinery which existed under the old war-time procedure. It also embodies provisions in respect of borrowed money.
The only other point arises on paragraph 10, which gets over the difficulty that company accounts may not be completed as at 31st December in either 1946 or 1951. It provides that, in that case, the accounts made up to the nearest date before those dates shall be treated as being in fact made on those dates.
§ Schedule read a Second time, and added.
§ Bill reported, with Amendments.
§ As amended, to be considered this day, and to be printed. [Bill 110.]