17. Income Tax (Husband and Wife)

Budget Resolutions and Economic Situation – in the House of Commons at 12:00 am on 12th April 1976.

Alert me about debates like this

Motion made, and Question, That—(1) In section 37(1) of the Income and Corporation Taxes Act (aggregation of wife's income with husband's) for the words "so far as it is income for a year of assessment or part of a year of assessment during which she is a married woman living with her husband" there shall be substituted the words "so far as it is income for—

  1. (a) a year of assessment; or
  2. (b) any part of a year of assessment, being a part beginning with 6th April, during which she is a married woman living with her husband".
(2) In section 38(1) of that Act (option for separate assessment) after the words "any year of assessment" there shall be inserted the words "for which his income would include any of hers" and the proviso shall be omitted.(3) In section 14 of that Act—
  1. (a) in subsection (2) for the words "Subject to subsection (3) below" there shall be substituted the words "Subject to subsections (3) and (4) below"; and
  2. (b) after subsection (3) there shall be inserted—
"(4) A person to whom this section applies by virtue of subsection (1)(a) above shall not be entitled to relief under this section for a year of assessment during any part of which that person is married and living with his or her spouse unless the child in connection with which the relief is claimed is resident with that person during a part of the year in which that person is not married and living with his or her spouse.
(4) In section 19(7) of that Act (life insurance premium paid by wife to count as if paid by husband) after the word "Where" there shall be inserted the words "in any year of assessment for which her husband's income includes or, if there were any, would include any of hers".(5) After section 21(1) of that Act (life insurance premium relief not to exceed one-sixth of a person's total income) there shall be inserted—(1A) In relation to a year of assessment in which a woman is married and living with her husband but for which his income does not or, if there were any, would not include any of hers, subsection (1) above shall apply to each of them as if the maximum there specified were increased by an amount equal to the difference between—
  1. (a) one-sixth of the other's total income; and
  2. (b) the premiums or other sums in respect of which relief is given to the other."
(6) Where during any part of a year of assessment a husband and wife are living together but his income for that year does not or, if there were any, would not include any of hers, then, if either of them—
  1. (a) would, if he or she had sufficient income for that year, be entitled to have any amount deducted from or set off against it under a provision to which this paragraph applies; and
  2. (b) makes a claim in that behalf,
that amount or, as the case may be, so much of it as cannot be deducted from or set off against his or her own income for that year shall instead be deducted from and set off against the income for that year of the other spouse.
(7) Paragraph (6) above applies—
  1. (a) in the case of the husband, to any provision of Chapter II of Part I of the income and Corporation Taxes Act 1970 (personal reliefs) and section 75 of the Finance Act 1972 (relief for payment of interest);
  2. (b) in the case of the wife, to—
    1. (i) any provision of that Chapter except sections 8(1)(b) and (1A)(b), 12, 13 and 14: and
    2. (ii) the said section 75 so far as applicable to interest paid in the part of the year of assessment mentioned in paragraph (6) above.
(8) For the purposes of section 168 of the Income and Corporation Taxes Act 1970 and section 71 of the Capital Allowances Act 1968 (set-off of losses and capital allowances against general income) section 37(1)(b) of the said Act of 1970 shall have effect as if the words "being a part beginning with 6th April" were omitted.And it is hereby declared that it is expedient in the public interest that this Resolution should have statutory effect under the provisions of the Provisional Collection of Taxes Act 1968—[Mr. Healey.]

put forthwith pursuant to Standing Order No. 94 (Ways and Means Motions), and agreed to.