26 / 346
GAZETTE
JANUARY/FEBRUARY 1983
period of ownership but this requirement does not
apply to the last 12 months of ownership.
Summa r y /Conc l u s i on
This situation is best summarised by comparing a
hypothetical Mr. A's net income for 1982/83:
(i) A married man living with his wife.
(ii) A person separated under a separation and
Court.
(iii) A person separated under a maintenance
agreement which is made a Rule of Court under
Section 8 of the 1976 Act.
Assume while married Mr. A's cost of maintaining
his wife is £5,000 per annum, and the same amount is
maintenance agreement which is not a Rule of
agreed for maintenance.
(i)
.
(ii)
(iii)
A. Income
£
£
15,000
£
£
15,000
£
£
15,000
Less:
Personal. Allowance
P.A.Y.E. Allowance
P.R.S.I. Allowance
Mortgage Interest
Maintenance
2,900
600
312
4,800
Nil
8,612
1,450
600
312
2,400
5,000
9,762
1,450
600
312
2,400
Nil
4,762
Taxable Income
(i)£ 6,388
(ii)£5,238
(iii)£10,238
Tax Payable
(i)
(ii)
(iii)
£2,000 at 25%
£4,388 at 35%
500.00
1,535.80
£1,000 at 25%
£3,000 at 35%
£1,238 at 45%
250.00
£1,000 at 25%
1,050.00
£3,000 at 35%
557.10
£2,000 at 45%
£2,000 at 55%
£2,238 at 60%
250.00
1,050.00
900.00
1,100.00
1,342.80
Total Tax
P.R.S.I.
Maintenance
of Spouse
2,035.80
767.00
5,000.00
1,857.10
767.00
5,000.00
4,642.80
767.00
5,000.00
(i)
(ii)
(iii)
B.
Total Tax and
Maintenance
£7,802.80 £7,624.10 £10,409.80
Net Disposal
Income (A-B) £7,197.20 £7,375.90 £ 4,590.00
In the case of number (iii), Mr. A would not have
sufficient income (£4,590.00) to meet his Mortgage
Interest (£4,800). It is clear therefore that in the case
of number (iii) Mr. A, in presenting evidence of his
income to the Court,
must
present his net (after-tax)
income, as below, so that the Court can properly
assess what proportion of that net income should be
ordered to be paid to Mrs. A for herself and any
dependant children.
Gross Income of Mr. A
Less Taxable (as above)
Less P.R.S.I.
Net disposable income of
Mr. A
18
£
15,000.00
(4,642.80)
( 767.00)
9,596.20
Comment. . . (Continued from P.3)
changes in Company Law arguing for heavier penalties for
"fraudulent trading". Both "fraudulent" and "trading
while insolvent" should be removed from the lexicon of
Company Law. Each require too high a degree of proof
and prosecutions can rarely be successfully mounted
against those who are suspected of such activities.
The recent Cork Report on Insolvency Law in the
United Kingdom recommended the introduction of the
concept of "wrongful trading" but on examination it
appears that the Committee still proposes the retention of
the words "with intent to defraud creditors" or carrying on
business "for any fraudulent purpose". What is needed is
not a retention of the unsatisfactory doctrine of fraud but
the introduction of a new concept which will not require
proof that the Defendant had any intent to defraud
creditors but merely that his actions were carried on in a
reckless manner without regard for the potential effects on
creditors.
The protection of limited liability is, as we have argued
before, given too lightly and too cheaply. Companies
should be required to pay substantial annual fees for the
right to retain the protection of limited liability. Part of
such revenue could be used to bring the operations of the
Companies Office to an acceptable level. The rest couldi
perhaps be put into a fund to assist the victims of dishonest
trading by limited companies. •