Clause 19. — (Interest Payable Abroad to Be Deductible in Computing Profits in Certain Cases.)

Part of Orders of the Day — Finance Bill – in the House of Commons at 12:00 am on 23 June 1949.

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Photo of Mr Osbert Peake Mr Osbert Peake , Leeds North 12:00, 23 June 1949

I beg to move, in page 12, line 32, after "secured," to insert "mainly."

Clause 19 is inserted, I believe, in order to correct a decision of the courts to the effect that interest payable overseas by a person carrying on a trade in the United Kingdom is not liable as a deduction for assessment of Income Tax in the United Kingdom. The Clause provides that, subject to five very stringent conditions, interest of that character shall be liable against assessment for Income Tax here. The second of the conditions is that the payment of the interest is secured upon assets outside the United Kingdom which are employed in the trade. It has been represented to us that there may be cases where the payment of the interest is primarily secured upon assets situated overseas but where also there is a floating charge upon assets situated in this country. For that reason we propose to insert the word "mainly."