| 22/8/2008 |
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| Board of Special Commissioners - Cases |
| Case No. 15/50 |
Decided: 21 October, 1950 |
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In the case of interest from Defence Bonds, what is assessable is the amount of accrued interest and not the actual amount of interest received - article 5(1), now 4(1), Income Tax Act
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The Board held that the wording of article 5(1) ("accruing in or derived from Malta or elsewhere, whether received in Malta or not") clearly shows that what is assessable is not the amount of interest income actually received (as had been assessed by the Commissioner) but the amount of interest income accrued during the relevant period (as declared by taxpayer). For this purpose the actual timing of the payment was irrelevant, otherwise this could give rise to abuse and evasion of tax.
In this case which concerned interest income from Defence Bonds, this principle is the more so applicable since the amount of interest income on these bonds is determined dietim. The Board therefore upheld the appeal and ordered a re-assessment
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