INCOME TAX

Bay of Plenty Beacon, Volume 2, Issue 166, 29 May 1940, Page 7

INCOME TAX

OVERPAYMENT A FREQUENT OCCURRENCE SELDOM RECTIFIED ACCOUNTANT'S ADVICE The arrived of the unwelcome season for filling in income tax forms is an unpleasant event in the commercial calendar. It is not welcomed even by accountants. In all countries the increasing burdens and complexities of income tax are providing plenty of important tasks for accountants. "Its problems occupy the attentions of many hundreds of officials an<l accountants, a large number of solicitors and members of the Bar, due to the fact that it is assessed on a statutory income and not the actual income of the taxpayer," remarks an English reviewer. | "What is the statutory income? I I suggest that this is the crux of the | problem in arriving at the intlividual's income tax liability, and that it is impossible for the layman to satisfy himself upon this point or even to ensure in many cases that he has obtained all the reliefs and allowances he may legitimately claim. It is, I think, true to say that concessions in practice, about which the layman may know nothing, will not, generally speaking, be extended to the taxpayer unless a request is made for them, and there is no doubt that overpayment of income tax is materially prevalent. In how many cases do we find on taking up the work of lodging an income tax return for a taxpayer who has previously rendered his own accounts and return that either certain legitimate expenses have not been charg ed or that certain allowances have not been claimed? It has become increasingly realised by the layman that expert advice is not merely desirable, but essential, if the taxpayer is to pay only his fair share to the State, and in view of the com- 1 plex nature of the subject he cannot be certain that there is no relief or allowance which he has not failed to claim or secure. "It is a common occurrence for accountants to be called upon to justify taxpayers' returns which have been lodged and which are per fectly in order, but which, on the face of them, disclose increases of capital in excess of the amount of savings which could have been accumulated from the income disclosed on the return. The result is annoyance and infinite amount of trouble to the taxpayer, *vyho feels that he has been suspected, unjustly of not fully disclosing liis income, and heavy costs which would have been avoided if his income and capital liad been reconciled from year to year."