19Income tax relief for National Insurance contributions
(1)For the year of assessment in which the graduated contribution scheme comes into operation and subsequent years the following provisions of this section shall have effect in substitution for subsection (2) of section three hundred and seventy-seven of the Act of 1952 (deduction from income for National Insurance contributions):
Provided that this section shall not affect any deduction in respect of employer's contributions.
(2)A claimant who proves that he is a contributor of any description specified in the first column of Part I of the Third Schedule to this Act shall be entitled, subject to the provisions of Part II of that Schedule, to a deduction from the amount of tax with which he is chargeable equal to tax at the standard rate on the amount specified in relation to that description in the second column of the said Part I.
(3)Where a claimant proves that he has his wife living with him, and that she is a contributor of any description specified in Part I of the Third Schedule to this Act, he shall be entitled to the like deduction from tax (in addition to any deduction under subsection (2) of this section to which he is entitled) as the wife would have been entitled to apart from section three hundred and fifty-four of the Act of 1952 (tax on husbands and wives), or where the husband proves the matters aforesaid as respects part only of the year of assessment, to the deduction to which the wife would have been so entitled if she had not been a contributor of any description specified in the said Part I during the remainder of the year ; and—
(a)in paragraph (c) of subsection (5) of section two hundred and twenty of the Act of 1952 (reduced rate relief) for the words from " under section three hundred and seventy-seven " to the end there shall be substituted the words " under subsection (3) of section nineteen of the Finance Act, 1960 ";
(b)where the wife has earned income for the year, the deduction under this subsection shall go, so far as may be, to reduce the tax chargeable on that income;
(c)section three hundred and fifty-eight of the Act of 1952 (consequences as respects personal allowances of exercise of option for separate assessment) shall apply in relation to relief under this section as it applies in relation to relief under section two hundred and nineteen or two hundred and twenty-five of that Act, but as if in paragraph (c) of subsection (2) of the said section three hundred and fifty-eight for the words "according as he or she made the payment giving rise to the relief" there were substituted the words " according as it was his or her liability to pay, or payment of, contributions which gave rise to the relief " and as if in the proviso to that subsection the reference to subsection (3) of section three hundred and fifty-four of the Act of 1952 included a reference to paragraph (b) of this subsection;
(d)in paragraph (b) of subsection (2) of section fourteen of the Finance Act, 1957 (allowance of personal reliefs for purposes of surtax where husband and wife are separately assessed), at the end of sub-paragraph (i) there shall be inserted the following—
“(ia)the amount (if any) added to the deduction in respect of relief under section nineteen of the Finance Act, 1960, shall be treated as reducing the income of the husband or the wife according as it was his or her liability to pay, or payment of, contributions which gave rise to the relief; ", and accordingly for the word " sub-paragraph " in sub-paragraph (ii) there shall be substituted the word " sub-paragraphs " , and for the words " sub-paragraphs (i) and (ii)" there shall be substituted the words " sub-paragraphs (i) to (ii) ".”.
(4)In subsection (1) of section fourteen of the Finance Act, 1957 (under which certain reliefs specified in paragraphs (a) to (c) thereof by reference to the enactments conferring them are allowable for purposes of surtax) at the end of paragraph (c) there shall be inserted the following— “and
(d)subsection (2) or (3) of section nineteen of the Finance Act, 1960 (relief for National Insurance contributions) ;”.
(5)The enactments relating to income tax, and in particular Part VIII of the Act of 1952, shall have effect as if subsections (1) to (3) of this section were contained in the said Part VIII between sections two hundred and eighteen and two hundred and nineteen.
(6)In this section and in the Third Schedule to this Act references to a contributor of any description shall be construed as references to a person liable to pay (directly or by deductions from remuneration) contributions under the National Insurance Act of the amount appropriate to that description, or a person entitled to pay such contributions who pays them, except that any married woman or widow who as such is by virtue of regulations under the National Insurance Act not required to pay contributions shall nevertheless be treated as a contributor and an employed person while she is an employed person and either is under pensionable age or has not retired from regular employment ; and other expressions have the same meanings as for the purposes of the National Insurance Act.
(7)In subsection (1) of this section the reference to the coming into operation of the graduated contribution scheme—
(a)in relation to a person whose liability to pay contributions arises, or who pays contributions, under the National Insurance Act, 1946, is a reference to the beginning of the week appointed under paragraph (b) of subsection (1) of section one of the National Insurance Act, 1959,
(b)in relation to a person whose liability to pay contributions arises, or who pays contributions, under the National Insurance Act (Northern Ireland), 1946, is a reference to the beginning of the week appointed under paragraph (b) of subsection (1) of section one of the National Insurance Act (Northern Ireland), 1959.