MORE TAXATION

Te Awamutu Courier, Volume 58, Issue 4194, 9 June 1939, Page 3

MORE TAXATION

RACING CLUBS AFFECTED. TAX COMMISSIONER’S REQUIREMENTS. Racing and trotting clubs in New Zealand, in common with many other sports bodies, have received notification from their headquarters executives of the decision of the Commissioner of Taxes that clubs are liable to pay social security tax of Is in the £1 on any profits they may make. The first instalment of the charge was due on May 1, and the racing and trotting clubs were urged by their governing bodies to pay it before June 1, and so avoid the 10 per cent, penalty for late payment. Reasons for making the charge on racing and trotting clubs were given by the Commissioner of Taxes as follows: Under section 125 (1) of the Social Security Act, 1938, “company” is liable to social security charge on income derived. “Company” as defined by section 2 of the Land and Income Tax Act, 1923> means any body incorporate, whether incorporated in New Zealand or elsewhere, but does not include a local or public authority. Under section 127 (1) of the Social Security Act “income” is defined to include inter alia income derived in accordance with sub-section 2 of section 4 of the Land -and Income Tax Amendment Act, 1930, which refers to “inconie derived by any person from the direct use or occupation of any land.” According to the circular sent out by the Racing Conference, where a club was unable to furnish its declaration of income by May* 31 in any year it must furnish a declaration marked “provisional,” showing the income derived for the last preceding year, and pay quarterly instalments of the charge on it. “Where such provisional declaration has been made,” the circular continues, “the club must, on completion of its annual accounts, forthwith make a declaration of income derived during such year. An adjustment will then be made for the, charge payable. It is necessary for all secretaries to give this matter their immediate attention to avoid the 10 per cent, penalty for late payment of the social security charge.”