Income & Corporation Taxes Act 1970
The Income and Corporation Taxes Act of 1970 is United Kingdom legislation containing regulations relating to the calculation and collection of taxes applying to personal and corporate income. The act provides for income tax relief granted to people with children and contains provisions to counter attempts to avoid paying tax. In 1992, the UK government repealed the Income and Corporation Taxes Act of 1970, and currently income tax and corporation tax laws are found in the Income Tax Act of 2007 and the Corporation Tax Act of 2010.
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Annuities and Royalties
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If you received an income as the result of an annuity, the amount you received was not classed as income for the purposes of attracting income tax, according to the 1970 act. An annuity is an amount you receive every year, such as an amount paid out of a trust fund that provides income that you may benefit from. You may have had to pay a surtax, which is a tax applied over and above standard income tax, on this income, but you did not have to pay standard income tax on the amount you received. If the money you received came from profits earned by the activity of the person or entity, such as a corporation or trust, paying you the annuity, the profits of the person or entity paying you were assessed for tax, and you could only receive your annuity from the after-tax profits of that entity.
Children
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If you had children under the age of 16 who still lived with you, or if you had children over the age of 16 who were still living with you while attending a full-time education course at a school, college or university, you were entitled to a reduction in the income tax you had to pay, for each child. The act stated that for each child over the age of 16, you were entitled to a £165 reduction in the income tax you had to pay. For children between the ages of 11 and 16, you received a reduction of £140; and for children under the age of 11, you received a reduction of £115.
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Tax Avoidance
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The act contained provisions to help prevent attempts to avoid paying tax. You were not allowed to avoid tax by transferring income intended for your benefit to someone living outside the UK. You were still liable to pay tax on any amount you transferred outside the UK if you were still able to enjoy the benefit of that income, either immediately or at some future date. If you did transfer your income to a person residing outside the UK, and that person would normally have had to pay UK tax on the income if that person had been residing in the UK, you were still liable to pay tax on the amount of income you transferred to that person.
Charities
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Charities did not have to pay tax on their income or capital gains. Income from lands and properties owned by public schools and hospitals were included in this exemption from taxation, provided that the income was used exclusively for charitable purposes. If a trust fund earned income that was used to pay for the repair of a church, cathedral or college chapel, or any place of worship, the income used exclusively for the repairs was not subject to taxation. Charities did not have to pay tax on any gains made from the acquisition and disposal of assets, such as land or buildings.
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