Testamentary annuity free of income tax includes super-tax and surtax where the gift uses unqualified wording.

A testamentary direction to pay an annuity "free of income tax" was construed broadly to cover super-tax and surtax, because the will used unqualified language and did not limit the exemption to deductions at source or to tax payable in respect of the annuity. The statutory materials treated super-tax and surtax as forms of additional income tax, and earlier authorities were distinguished where the wording was narrower. On that construction, the trustees' obligation extended to bearing the full tax burden, including super-tax and surtax.

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Issues: Whether a testamentary direction to pay an annuity "free of income tax" includes freedom from super-tax, or surtax.

Analysis: The direction in the will was expressed simply as payment of a fixed annual sum free of income tax, without any language confining the freedom to deductions at source or otherwise limiting the trustees' obligation. The statutory materials treated super-tax and surtax as an additional form of income tax, and the earlier authorities were distinguished on the basis that they turned on wording referring to deductions or payment "in respect thereof". On that construction, the expression "income tax" in the present bequest was wide enough to cover the additional tax burden described as super-tax or surtax.

Conclusion: The direction to pay the annuity free of income tax includes freedom from super-tax and surtax.

Ratio Decidendi: In construing a testamentary gift of an annuity free of income tax, absent restrictive language tied to deductions or payment in respect of the annuity, the expression "income tax" includes an additional income-tax charge such as super-tax or surtax.

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