HC Deb 21 February 1940 vol 357 c1367W
Sir R. Gower

asked the Chancellor of the Exchequer whether he is aware that many firms, businesses and professional partnerships which have been hard hit by the war will not benefit by the Income Tax concession given in the Finance Act of 1939, because the loss of revenue which they have suffered, and will suffer, will not become apparent in their accounts for the current financial year either because their accounts are made up to December, 1939, or because their income may be mainly dependent upon the payment of accounts rendered for services many months previously; and whether he will consider extending the concession given in that Act to cover serious diminution of income suffered by such firms in the year 1940–41, as compared with the immediate pre-war period?

Sir J. Simon

As regards the first part of the Question, my hon. Friend seems to be under some misapprehension as to the application of Section 11 of the Finance (No. 2) Act, 1939, which provides for relief from Income Tax for 1939–40 in cases of diminution of earned income owing to circumstances connected with the war. Where the period of the taxpayer's accounts is not identical with the Income Tax year ending 5th April, 1940, his actual earned income for 1939–40 can be computed by apportionment of the profits shown by the accounts which commence before, and the accounts which end after, that year. As regards the second part of the Question, while I appreciate that there may be a case for extending the provisions of Section 11 to the year 1940–41, my hon. Friend will not expect me to anticipate my Budget Statement