Inland Revenue v. Juridical Society of Edinburgh

Subject_1 Revenue Subject_2 Income Tax Subject_3 Exemption Subject_4 “Literary or Scientific Institution” — Income Tax Act 1842 (5 and 6 Vict. cap. 35), sec. 61, Sched. A, Rules No. VI. Facts: The Income Tax Act 1842, Schedule A, Rules No. VI, exempts from income tax “any building, the property of any literary or scientific institution, used solely for the purposes of such institution, and in which no payment is demanded for any instruction there afforded.”

Held that the Juridical Society of Edinburgh was not “a literary or scientific institution” within the meaning of the rule, because its main object was the professional interest of its members, and accordingly that its premises were not entitled to exemption from income tax.

The Income Tax Act 1842 (5 and 6 Vict. cap. 35), Schedule A, Rules No. VI, provides for exemption, inter alia , in the following case—“For the duties charged on … any building, the property of any literary or scientific institution, used solely for the purposes of such institution, and in which no payment is made or demanded for any instruction there afforded by lectures or otherwise; provided also that the said building be not occupied by any officer of such institution nor by any person paying rent for the same.”

The Juridical Society of Edinburgh (hereinafter referred to as the “Society”) appealed to the Commissioners for the General Purposes of the Income Tax Acts, and for executing the Acts relating to the Inhabited House Duties for the County of Edinburgh, against an assessment made upon it for the year ending 5th April 1911 of £5, 5s. of duty, being income tax at the rate of 1s. 2d. in the £ on £90, the net annual value of the premises at 40 Charlotte Square, Edinburgh, Page: 644 ↓

The Case stated—1. The annual value of the premises entered in the valuation roll was £120, but for purposes of assessment that value was reduced to £90 by an allowance of £10 for owner's rates and of £20 for repairs.