| Case ID |
19fb8299-08d7-4190-8540-a0892549be80 |
| Body |
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| Case Number |
D-2741 of 2016 |
| Decision Date |
Nov 25, 1960 |
| Hearing Date |
Oct 21, 1958 |
| Decision |
The House of Lords held that the royalties received by the executor of Peter Cheyney are not assessable to income tax under Schedule D as they are considered the fruit of professional activities carried out during the author's lifetime. The court determined that the nature of the payments did not change upon the author's death, and thus the executor is not liable for income tax on these royalties. The decision emphasized that the payments are rooted in the professional activities of the deceased and retain that character despite the cessation of his profession with his death. |
| Summary |
In the case of Carson (Inspector of Taxes) vs. Cheyney's Executor, the House of Lords addressed the issue of whether royalties received posthumously by the executor of a deceased author were subject to income tax. The court concluded that the payments were inherently linked to the professional activities of the author, Peter Cheyney, and maintained their character as professional earnings even after his death. This landmark decision clarifies the taxation of royalties and highlights the distinction between income derived from professional activities and income from property. The ruling is essential for understanding tax obligations for estates receiving ongoing income from intellectual property, particularly in the literary domain. Keywords include 'income tax', 'royalties', 'professional earnings', 'intellectual property tax', and 'posthumous income tax'. |
| Court |
House of Lords
|
| Entities Involved |
Cheyney's Executor,
Gilbert Carson (Inspector of Taxes)
|
| Judges |
Viscount Simonds,
Lord Morton of Henryton,
Lord Reid,
Lord Tucker,
Lord Keith of Avonholm
|
| Lawyers |
Sir Reginald Manningham Butler Q.C.,
Hilary Magnus Q.C.,
Alan Orr,
Viscount Bledisole Q.C.,
C. N. Beattie
|
| Petitioners |
Gilbert Carson (Inspector of Taxes)
|
| Respondents |
William Alexander Roy Collins (Cheyney's Executor)
|
| Citations |
1960 SLD 48 = 1960 PTD 455
|
| Other Citations |
Stainers Executors v. Purchase 1952 A C 280,
1958 Ch. 345
|
| Laws Involved |
Income Tax Act, 1922,
Income Tax Act, 1918,
Income Tax Act, 1952
|
| Sections |
44,
Schedule D, Cases II, III, VI,
Schedule D, Cases II, III, VI
|