TaxPersonal TaxThe Big Question – Tax credit gets all-clear

The Big Question - Tax credit gets all-clear

Only 20% of finance directors believe the Working Family Tax Credit will have an adverse affect on their organisations, writes Ben Griffiths.

This week’s Big Question survey, carried out by Accountancy Age and Reed Accountancy Personnel, found that 54% of FDs thought the WFTC would not hurt their business.

The WFTC replaces Family Credit next October and will initially be operated by the Inland Revenue. But from April 2000, employers will be required to pay low-income staff tax credits in addition to basic salary over a 26-week period. Employers can then offset it against PAYE and national insurance liabilities.

Many FDs thought the tax credit would increase administration work. David Curtis, FD of Autotype International, said: ‘This is yet another administrative burden that Blair’s government is passing on to business.’

A quarter of FDs remained neutral about the credit’s impact, but many felt it was ‘just another responsibility being put on to the employer’.

‘Any schemes to encourage people back to work should

be encouraged, although having to pay money up front on behalf of the government may upset cashflow,’ one FD said.

Of the FDs who thought the tax credit would have no adverse effect, many said their employees were paid more than the earnings threshold to qualify for the credit.

Related Articles

LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

2d Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

2w Emma Smith, Managing Editor
HMRC urged to clarify impact of income allowances on Self-Assessments

Personal Tax HMRC urged to clarify impact of income allowances on Self-Assessments

2m Alia Shoaib, Reporter
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

2m Emma Rawson, ATT Technical Officer
Wealthy individuals could circumvent top tax rate rises

Personal Tax Wealthy individuals could circumvent top tax rate rises

4m Alia Shoaib, Reporter
Italy grants first successful non-dom status application to former UK non-dom

Personal Tax Italy grants first successful non-dom status application to former UK non-dom

4m Emma Smith, Managing Editor
Industry reaction: Taylor Review does not go far enough in addressing tax issues

Legal Industry reaction: Taylor Review does not go far enough in addressing tax issues

5m Alia Shoaib, Reporter
Does the Taylor Review sufficiently address the gig economy?

Corporate Tax Does the Taylor Review sufficiently address the gig economy?

5m Alia Shoaib, Reporter