Inland Revenue v. Edinburgh Life Assurance Co. [1909] ScotLR 499 (09 March 1909)

Inland Revenue v. Edinburgh Life Assurance Co. [1909] ScotLR 499 (09 March 1909)

A life assurance company assessed on investment income must debit annuities proportionally against taxed and untaxed revenue, and is only required to account to the Crown for income tax deducted from annuities paid out of revenue not already taxed; double taxation is not permitted.

Citation
[1909] ScotLR 499
Parties
Pursuer: Inland Revenue; Defender: Edinburgh Life Assurance Company
Jurisdiction
Scotland
Judgment Date
09 March 1909
Procedural Posture
Civil / Appeal (reclaiming Note) From Lord Ordinary's Decision
Outcome
Lord Ordinary's decision recalled; case remitted for apportionment and calculation of tax due; no expenses awarded for reclaiming note.
Legal Topics
Income Tax, Life Assurance, Annuities, Double Taxation, Assessment Basis, Deduction of Tax at Source
Revenue Law Taxation Commercial Law Income Tax Life Assurance Annuities Double Taxation Assessment Basis +1 more

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Parties

Inland Revenue

Pursuer

Edinburgh Life Assurance Company

Defender

Procedural Posture

Civil / Appeal (reclaiming Note) From Lord Ordinary's Decision

Legal Issues

  1. 1 Whether a life assurance company, assessed to income tax on investment income rather than trading profits, must account to the Crown for income tax deducted from annuities paid to annuitants, and if so, to what extent.

Ratio Decidendi

A life assurance company assessed on investment income must debit annuities proportionally against taxed and untaxed revenue, and is only required to account to the Crown for income tax deducted from annuities paid out of revenue not already taxed; double taxation is not permitted.

Court Disposition

Lord Ordinary's decision recalled; case remitted for apportionment and calculation of tax due; no expenses awarded for reclaiming note.

Orders

  • Recall the Lord Ordinary's interlocutor of 30th July 1908.
  • Find that annuities paid must be debited proportionally against taxed and untaxed revenue each year.