Finance Act, 1974

Arrangements for payment of interest less tax or of fixed net amount.

39.—(1) It is hereby declared that any provision made before or after the passing of this Act, whether orally or in writing, for the payment of interest “less tax”, or using words to that effect, is to be construed, in relation to interest payable without deduction of tax, as if the words “less tax”, or the equivalent words, were not included.

(2) In relation to interest on which the recipient is chargeable to tax under Schedule D, and which is payable without deduction of tax, any provision, made before or after the passing of this Act, whether orally or in writing and however worded, for the payment of interest at such a rate (referred to subsequently in this subsection as the “gross rate”) as shall, after deduction of tax at the standard rate of tax for the time being in force, be equal to a stated rate, shall be construed as if it were a provision requiring the payment of interest at the gross rate.