HC Deb 07 July 1965 vol 715 cc1656-7
Mr. MacDermot

I beg to move Amendment No. 17, in page 13, line 30, to leave out "forming" and to insert "which have formed".

Mr. Speaker

Perhaps it would be for the convenience of the House if we were to discuss with this Amendments Nos. 18, 19, 20 and, in page 4268, Nos. 64 to 67 inclusive to Clause 29.

Mr. MacDermot

These numerous Amendments deal with a relatively small point. The first three Amendments to Clause 17 provide that the rule about two or more assets forming part of a set of assets is to apply only if the assets form part of a set of articles of any description all owned at one and the same time by one and the same person. This point was raised in Committee. It was never the intention to try to apply the set provision in a case in which the articles had not all been in common ownership, and my hon. and learned Friend the Solicitor-General undertook in Committee to look at this matter and to see whether provisions could be written, into the Bill to make it clear.

This the Amendments do. The first three Amendments to Clause 29 achieve the same result. The fourth Amendment to each of these Clauses deals with an essentially drafting point to spell out the original intentions and to avoid any possible misinterpretation. They have the effect that if there is a disposal of a right or interest in or over a chattel, for example if a person leases an interest in a chattel which he owns, then the value of what remains undisposed of—the value of the rights which he retains in the chattel—is to be added to the consideration received for the disposal in determining whether the chattel is chargeable on the gain or loss which has emerged from the transaction.

The provisions as they stood have been criticised as being open to a possible misinterpretation so as to result in an undue liability to charge. That was not the intention, and I think that the drafting of these provisions makes it clear that it is solely for the purpose of calculating the true gain that one must have regard to the valuation of all the interests in the chattel.

Amendment agreed to.

Further Amendments made: In page 13, line 31, after "description", insert: all owned at one time by one person". In page 13, line 31 leave out "the same"and insert "that".

In page 13, line 43, leave out from "property" to end of line 45 and insert:

  1. (a) in the first instance those subsections shall be applied in relation to the asset as a whole, taking the consideration as including the market value of what remains undisposed of, in addition to the actual consideration,
  2. (b) where the sum of the actual consideration and that market value exceeds one thousand pounds, the limitation on the amount of income tax (including surtax) in subsection (1) shall be to half the difference between that sum and one thousand pounds multiplied by the fraction equal to the actual consideration divided by the said sum, and
  3. (c) where that sum is less than one thousand pounds any loss shall be restricted under subsection (2) of this section by deeming the actual consideration to be the actual consideration plus the said fraction of the difference between the said sum and one thousand pounds.—[Mr. MacDermot.]