BIM14060 - Schedule D: Annual profits or gains

The charge under Schedule D relates only to 'annual profits or gains'. The term 'annual' does not restrict the meaning of 'profits or gains' in any narrow way. In particular it does not imply that the profits must

• recur year by year, or
• last for a year, or
• be calculated with reference to a year.

The word 'annual' reinforces the principle that what is being charged is income - annual profits - and not capital. Any profit, which has the nature of income as distinct from a capital receipt, is an 'annual profit'. This is so even when the amount does not recur, is not intended to recur and arises for a short period only. (See The Scottish Provident Institution v Farmer [1912] 6TC34; Ryall v Hoare [1923] 8TC521; Martin v Lowry [1926] 11TC297; Wilson v Mannooch [1937] 21TC178.)