Inland Revenue v Alexander Stirling Ltd
| Jurisdiction | Scotland |
| Judgment Date | 15 June 1943 |
| Date | 15 June 1943 |
| Docket Number | No. 41. |
| Court | Court of Session (Inner House - First Division) |
1ST DIVISION.
RevenueExcess profits taxComputation of standard profitsAllowance for "working proprietor"Finance (No. 2) Act, 1939 (2 and 3 Geo. VI, cap. 109), sec. 13Finance Act, 1940 (3 and 4 Geo. VI, cap. 29), sec. 31.
The Finance (No. 2) Act, 1939, sec. 13, as amended by the Finance Act, 1940, sec. 31, enacts that, for the purposes of excess profits tax, the standard profits of a business shall in certain cases be an amount arrived at after making an allowance for each "working proprietor," defined to mean "a proprietor who has, during more than one half of the chargeable accounting
period in question, worked full time in the actual management or conduct of the trade or business."A company, assessed to excess profits tax for the chargeable accounting period of a year, claimed this allowance in respect of one of its directorsa "proprietor" within the meaning of the Actwho was the principal person in its management. This director, a woman, had no other business interests, and gave the business of the company all the attention that was necessary for its efficient conduct. For this purpose she attended business daily for two and a half hours, except on Wednesdays, when she attended for the whole day. Throughout July, when the secretary was on holiday, she attended for the whole day. In the aggregate her attendances during the accounting period exceeded one-half of the business hours of the company.
Held that the company was not entitled to the allowance for a "working proprietor," in respect that the director in question was not a full-time worker except during the month of July.
Opinion per Lord Moncrieff that days in an accounting period in which a person has worked full time, although not occurring consecutively, may be aggregated for the purpose of determining whether he has worked full time for the necessary period.
Alexander Stirling, Limited, appealed to the Commissioners for the Special Purposes of the Income Tax Acts at Glasgow against an assessment to excess profits tax for the chargeable accounting period 1st January 1940 to 31st December 1940. The company had elected that, for the purposes of excess profits tax, the standard profits of its trade should be the minimum amount specified in section 13 (2) of the Finance (No. 2) Act, 1939, as amended by the Finance Act, 1940.1 The question in the appeal was whether, in the computation of its standard profits, the company was entitled to an allowance for Mrs Margaret Stirling as a working proprietor. The Special Commissioners held that the company was entitled to this allowance, and, at the request of the Commissioners of Inland Revenue, stated a case for the opinion of the Court of Session.
The stated case set forth that the following facts were proved or admitted:"(1) The company, which carries on its trade at
64 Moncur Street, Glasgow, as grocers', butchers' and fishmongers' outfitters, was incorporated in 1920. The issued capital of the company is 10,000...To continue reading
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Palmer v Maloney and Shipleys
...by Williams Davies Meltzer) for the defendants. The following cases were referred to in the judgment: IR Commrs v Alexander Stirling Ltd 1944 SLT 79 IR Commrs v D Devine & Sons Ltd TAX(1963) 41 TC 210 Melluish (HMIT) v BMI (No. 3) Ltd TAX[1995] BTC 381 Pepper (HMIT) v Hart TAXELR[1992] BTC ......
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Commissioners of Inland Revenue v D. Devine & Sons Ltd
...or whole-time worker. 10. The following cases were cited in argument:Commissioners of Inland Revenue v. Alexander Stirling, Ltd.,SC1943 S.C. 476;Wilkie, Neck and Smith v. Commissioners of Inland RevenueUNK[1946] 2 All E.R. 13 11. On these facts I gave my decision in writing on the 2nd Decem......
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Commissioners of Inland Revenue v D. Devine and Sons, Ltd
...or whole-time worker. 10. The following cases were cited in argument:Commissioners of Inland Revenue v. Alexander Stirling, Ltd.,SC1943 S.C. 476;Wilkie, Neck and Smith v. Commissioners of Inland RevenueUNK[1946] 2 All E.R. 13 11. On these facts I gave my decision in writing on the 2nd Decem......
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Smart v Commissioners of Inland Revenue
...not qualify as a "working proprietor" within the above Section. (The case of Commissioners of Inland Revenue v. Alexander Stirling, Ltd. 1944 S.L.T. 79, was referred to). For the remaining chargeable accounting periods, it was admitted that the Appellant had shewn herself to be entitled to ......