§ 8.45 p.m.
§ Mr. Robert SheldonI beg to move amendment no. 55, in page 16, leave out lines 28 to 31 and insert:
'(4) No claim shall be made under this section—'.
§ Mr. Deputy Speaker (Sir Myer Galpern)With this amendment we may take Government amendment no. 56.
§ Mr. SheldonThese amendments meet two points concerning the time limit for claims to the averaging provisions for farmers. In Committee, my right hon. Friend accepted in principle an amendment moved by the right hon. Member for Crosby (Mr. Page) and said that we would be prepared to table an amendment on Report to meet its objective.
The new subsection introduced by amendment no. 56 is concerned with situations where the profits for the year are adjusted either up or down for reasons other than averaging. That can take place for example when there has been an error or an alteration in circumstances or the inspector perhaps discovers additional profits to be assessed. In that event, the averaged profits are to be ignored and the adjustment is to be made on the basis of the gross profits as originally computed. The new subsection provides for the farmer to be able to claim for averaging the adjusted profits as long as the claim is made within one year of the end of the year of assessment.
There is a second feature of these amendments which was not raised in 1618 Committee but has been explained in representations since. The problem is that by the time the claim for averaging is made it could be too late to do anything about existing claims, for example, in respect of stock relief or capital allowances. Under the present rules, it would not be possible to change or to withdraw the original claim for relief on the profits after they have been averaged. As the effect of averaging is to change the profit figure on which the original claim was based, it is right that the taxpayer should be allowed to start again on the basis of the new figure. I hope that these amendments commend themselves to the House.
§ Mr. Graham PageI am obliged to the Financial Secretary for improving on the amendment that I moved in Committee and for bringing his amendment forward today.
§ Amendment agreed to.
§
Amendment made: no. 56, in page 17, line 43, at end insert—
'(8) Any claim under this section shall be made by notice in writing given to the inspector not later than two years after the end of the second of the years of assessment to which the claim relates but any such further claim as is mentioned in subsection (5)(c) above shall not be out of time if made before the end of the year of assessment following that in which the adjustment is made.
(9) Where a person makes a claim under this section in respect of any year of assessment, any claim by him for relief for that year under any other provision of the Income Tax Acts—
but no claim shall by virtue of this subsection he made, revoked or amended after the determination of the claim under this section.'.—[Mr. Robert Sheldon.]