Scottish Provident Institution v Allan: HL 30 Apr 1903

A mutual insurance society in Scotland was assessed for income tax under the fourth case of Schedule D of the Income Tax Act 1842 upon certain sums remitted to them from Australia in 1898. They maintained that they were not liable to be so assessed, upon the ground that the sums so remitted were not remitted in payment of interest but in repayment of capital. Between 1885 and 1890 the society had sent various sums to Australia for investment. The interest on these investments was received by the society’s representatives in Australia and paid into a bank account there, and prior to 1893 it was not brought to this country but invested in Australia. In and after 1893 certain sums were remitted to Scotland from Australia, and in 1898 the sum upon which income tax was now claimed was so remitted. After all these remittances had been made there still remained in Australia a sum greater than the total of all the sums originally sent out for investment. Held ( aff. judgment of the First Division) that the remittances to this country having been made by the representatives of the society from their bank account in Australia, in which repayments of capital had been immixed with interest, and the particular remittances not having been definitely identified with any particular repayments of capital, the proper inference in the circumstances was that the remittances were made in payment of interest, and that the society was liable to be assessed for income tax upon the sums remitted.


Lord Chancellor (Halsbury), Lord Shand, Lord Davey, and Lord Robertson


[1903] UKHL 605, [1903] UKHL TC – 4 – 591, 4 TC 591, 40 SLR 605


Bailii, Bailii



Income Tax

Updated: 27 June 2022; Ref: scu.630576