TAX DISPUTE.

Auckland Star, Volume LXXI, Issue 227, 24 September 1940, Page 3

TAX DISPUTE.

APPEAL COURT CASE. OMISSIONS FROM RETURN. WELLINGTON, this day. A dispute concerning taxation assessments between the New Zealand Dairv Farm Mortgage Company, Limited, of Hamilton, appellant, and the Commissioner of Taxes, as respondent is occupying the attention of the Appeal Court to-dav.

Shortly after its incorporation in January, 1936, the company, with a view to oibtaining money for relending on mortgage, raised by the issue of debentures, and during the financial year ended March 31, 1937, granted applications for loans to the value of £158,517. A reserve fund required to be constituted with respect to this. The amount of advances wae £3176 6/10, and was constituted by cash payments of £468 0/10, and additions to mortgages of £2705. The balance-sheet for the financial year ending March 31, 1937. showed the amount standing to the credit of the reserve fund, after the payment of certain expenses, was £3111 1/10. In its income tax return for the income year ending March 31, 1937, the company deducted or omitted from its assessable income this sum of £3111 1/10, and also £339 5/ brokerage incurred on the issue of debentures, and £263 4/7 for printing, advertising and legal expenses in connection with the debentures. The Commissioner, not agreeing to these deductions or emissions, stated a case for the opinion of the Supreme Court, and the case has now been removed into the Court of Appeal. Argument is proceeding. — (Press Assn.)