Finance Act 1947

Miscellaneous provisions as to the profits tax.

45Amendment of limit on amount allowable as deduction in respect of directors' remuneration.

In paragraph 11 of the Fourth Schedule to the Finance Act, 1937 (which limits the amount of the deduction to be allowed in respect of the remuneration of certain directors in computing for the purposes of profits tax the profits arising from a trade or business carried on by a company in which the directors have a controlling interest), for the words " fifteen hundred pounds ", wherever those words occur, there shall be substituted the words " two thousand five hundred pounds. "

46Co-ordination of treatment for profits tax purposes with treatment for income tax and excess profits tax purposes, etc..

(1)The provisions of Parts I and II of the Eighth Schedule to this Act shall have effect with a view to securing that the treatment of persons for the purposes of the profits tax accords, as respects the matters, and to the extent, specified in those Parts of that Schedule, with the treatment which they receive as respects those matters for the purposes of income tax and excess profits tax.

(2)The provisions of Part III of the said Schedule (being miscellaneous amendments of the law relating to the computation of profits for the purposes of the profits tax and other related matters) shall have effect for the purposes of the profits tax.

47Commencement of Part IV and transitional provisions.

(1)Subject to the provisions of this section, the provisions of this Part of this Act relating to the profits tax shall have effect with respect to all chargeable accounting periods any part of which falls after the end of the year nineteen hundred and forty-six :

Provided that this subsection shall not apply to any of those provisions in so far as other express provision is made by them respectively as to the chargeable accounting periods with respect to which they are to have effect.

(2)In the case of a chargeable accounting period falling partly before and partly after the end of the year nineteen hundred and forty-six, the profits tax shall be computed first on the basis that the provisions to which subsection (1) of this section applies do not have effect with respect to the period and secondly on the basis that the said provisions do have effect with respect thereto and the sums so ascertained shall be apportioned between the part of the period which falls before, and the part of the period which falls after, the end of the said year ; and, subject to the provisions of subsection (3) of this section—

(a)the profits tax payable for the whole period shall be the sum of so much of the amount ascertained on the first basis as is apportioned to the first part of the whole period and so much of the amount ascertained on the second basis as is apportioned to the second part thereof, and

(b)any apportionment required for any of the purposes of section nineteen of the [2 & 3 Geo. 6. c. 109.] Finance (No. 2) Act, 1939, or of the Sixth Schedule to the [3 & 4 Geo. 6. c. 29.] Finance Act, 1940 (the provisions of which have effect as respects the relation of excess profits tax to the profits tax and the assessment and collection of those taxes) shall, instead of being made in accordance with subsection (6) of the said section nineteen or paragraph 8 of the said Sixth Schedule, be made in the proportion arrived at by comparing that part of the amount ascertained on the said first basis which is apportioned as aforesaid to the first part of the whole period with that part of the amount ascertained on the said second basis which is apportioned as aforesaid to the second part thereof.

(3)The provisions of paragraph 3 of Part II of the Eighth Schedule to this Act shall, so far as they provide for a reduction of tax, be left out of account in computing the tax payable on both the first and second bases mentioned in subsection (2) of this section, and the reduction of tax provided for by that paragraph shall be made, and made only, by reducing that part of the tax computed on the first basis which is apportioned to the first part of the period ; and the provisions of the said subsection (2) shall have effect accordingly.

(4)Where non-distribution relief is given for a chargeable accounting period falling partly before and partly after the end of the year nineteen hundred and forty-six, the difference on which the relief is given shall, for the purpose of arriving at the distribution charges, if any, falling to be made for subsequent chargeable accounting periods, be treated as reduced by so much thereof as is apportionable to the part of the chargeable accounting period which falls before the end of the said year.

(5)Any apportionment which is required for the purposes of subsection (2) of this section of the profits tax of a period falling partly before and partly after the end of the said year, on either of the bases referred to in that subsection, and any apportionment which is required for the purposes of subsection (4) of this section, shall be made by reference to the number of months or fractions of months in each of the parts of the whole period :

Provided that where the profits of the whole period have been apportioned in any other manner for the purposes of excess profits tax between the first part of the period and the remainder of the period, the said apportionments under subsections (2) and (4) of this section shall also be made in that manner.

48Interpretation of Part IV.

(1)References in this Part of this Act to the computation of profits include references to the computation of any such losses as, under any enactment relating to the profits tax, fall to-be computed in the same manner as profits are to be computed for the purposes of the profits tax.

(2)References in this Part of this Act to shares include references to stock, and the expression " share capital " shall be construed accordingly.

(3)References in this Part of this Act to the personal representatives of a deceased person include references to trustees of the estate, or part of the estate, of that person.