Company directorship as a UK office of profit was taxable under Schedule E despite overseas residence and activity.

A director of an English company resident and controlled in the United Kingdom was treated as holding an office within the United Kingdom for Schedule E purposes, because the office attached to the company's management structure and its rights and duties arose in the UK, even though the director lived and acted abroad. The directorship was also held to be a public office of profit, since it was a substantive and permanent office with statutory duties and public formalities under company law, and the company's private character did not exclude it from the Schedule. The assessment to income tax was upheld and the appeal dismissed with costs.

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Issues: (i) whether a director of an English company resident and controlled in the United Kingdom holds an office within the United Kingdom for the purpose of Schedule E of the Income-tax Act, 1918; (ii) whether such directorship is a public office of profit within Schedule E.

Issue (i): whether a director of an English company resident and controlled in the United Kingdom holds an office within the United Kingdom for the purpose of Schedule E of the Income-tax Act, 1918

Analysis: Schedule E charged tax on persons having or exercising offices of profit within the United Kingdom. The directorship was treated as an office attached to the corporate structure of an English company, with the relevant rights and duties arising in this country. The fact that the director resided abroad and performed many activities overseas did not displace the locality of the office, since the office existed as part of the management of the English company and was capable of being held irrespective of where the holder physically acted.

Conclusion: The office was held to be within the United Kingdom.

Issue (ii): whether such directorship is a public office of profit within Schedule E

Analysis: A directorship was held to be a permanent and substantive office with an existence independent of the individual holder. The court treated the expression "public office" in the Schedule as extending to offices under a company, including a private company, because the Companies Act imposed statutory duties and public formalities upon corporate officers. The statutory setting showed sufficient public character in the office, and the distinction between public and private companies did not prevent the office from being public for income-tax purposes.

Conclusion: The directorship was held to be a public office of profit.

Final Conclusion: The assessment to income-tax under Schedule E was upheld, and the appeal was dismissed with costs.

Ratio Decidendi: A directorship of an English company resident and controlled in the United Kingdom is an office within the United Kingdom and, by reason of the statutory duties and public character attached to company offices, constitutes a public office of profit chargeable under Schedule E.

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