1965-HKRS30-8-55_Part05 — Page 34

Devetocol portfolice.

Rights of objection and

Appeal.

other purpose or purposes, such interest as is attributable to the part used for the purpose of acquiring such shares shall, subject to paragraph (2), not be an allowable deduc tion, and where any apportionment is necessary to ascer tain the amount of interest so attributable, it shall be made on such basis as is most reasonable and appropriate in the circumstances of the case.

(2) Where a person is chargeable to tax under Part IV of the Ordinance in respect of profits from share deal- ing, no apportionment or disallowance of interest shall be made under paragraph (1) in respect of any money bor- rowed and used for the purpose of acquiring the shaces constituting the subject-matter of such share dealing.

20. (1) Where the investment portfolio of any person who is chargeable to tax under Part IV of the Ordinance is, in the opinion of the assessor, sufficiently substantial to warrant making an adjustment in respect of the expenses of supervision and management of the portfolio, a duc pro- portion of the management, clerical and general expenses attributable to the supervision and management of the investment portfolio shall be disallowed, and, unless & more practical and suitable basis is available in the circumstances of the case, the estimation of such due proportion of the management, clerical and general expenses shall be made on the basis of such percentage of the total cost of the investments and securities which comprise the investroent portfolio as is most reasonable and appropriate in the cir cumstances of the case, not exceeding~

(a) one-eighth per cent in any case where the invest- ments are held not for purpose of, or not solely for the purpose of, producing profits by way of dividends, but for. or also for, the purpose of producing profits by resale or share dealing:

(5) one-half per cent, in any other case.

(2) Where the investment portfolio of any person who is chargeable to tax under Part IV of the Ordinance is not, in the opinion of the assessor, sufficiently substantial wo warrant making an adjustment in respect of the supervision and management of the portfolio, no disallowance or appor- tioument shall be made under paragraph (1).

2D. Any decision under rule 2A, 2B or 2C shall be subject to the same rights of objection and appeal as are conferred by Part XI of the Ordinance.”.

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Made by the Board of Inland Revenue this 7th day of October, 1955,

Explanatory Note.

نسه

Chairman,

M. W. Lo, Member.

J. B. HART, Member.

P. C. Woo. Member.

H. WARDLE,

Member.

(This Nole is not part of the rutes, but is intended

to indicate their general purport).

These rules add four new rules to the Inland Revenue Rules specifying the methods to be followed for ascertaining to what extent any outgoing or expease 1 la incurred in the production of chargeable profits and therefore deductible

under section 16 of the Ordinance.