§ Mr. WATT
asked the Chancellor of the Exchequer whether he is aware that his Department refuses to allow the principle of averaging for three years on the profits from house-letting in districts where that is an important industry; and whether, in view of the trials which such districts have experienced since the beginning of the 1230W War, he will instruct his Department to adopt the averaging system, particularly in view of the fact that it is held by many authorities that it is illegal to refuse the collating of the three years?
§ Mr. McKENNA
I do not feel sure whether my hon. Friend is referring to the letting of unfurnished houses or of furnished houses, or to the business of letting lodgings, keeping a boarding-house, etc. I will, therefore, deal with the subject under each of those heads.
- 1. Letting Unfurnished Houses.—The profits derived are chargeable under the general rule (No. 1) of Schedule A, on the annual value which the property is worth to be let from year to year, without reference to any average.
- 2. Letting Houses Furnished.—The profits are chargeable under Case VI. of Schedule D either on the profits received annually or on an average of such period, greater or less than one year, as the case may require and as shall be directed by the local Commissioners of taxes. In practice such assessments are usually computed on the profits of one year, the current or preceding one, but where the house is let furnished year after year no objection would be taken, subject to the concurrence of the local Commissioners, to the profits, so far as they exceed the profits of ownership applicable to the period for which the house is let and already assessed under Schedule A, being computed on the average of the three preceding years.
- 3. Letting Lodgings, Keeping Boarding-houses, etc.—Such profits are charged under Case I., Schedule D, on the average of the three preceding years.