YOU MAY BE DUE FOR SOME CREDIT
By Olivia Cooper
MOST farmers would not turn down the opportunity to bring in an extra £82.25/week, but that is exactly what some are doing by not claiming Working Families Tax Credit.
WFTC was introduced in 1999 to make employment worthwhile for those on low incomes. Anyone with children, who is working for less than about £350/week after tax and National Insurance, and with savings of £8000 or less, is eligible.
Over 1.3m families receive this extra income, and although a growing number of farmers are aware of the credit, many do not believe they qualify, according to the Tenant Farmers Association.
Unfortunately, owner-occupiers who have diversified may not be eligible, and until recently many tenant farmers were disqualified too. Tenant farmers who lived in job-related accommodation, but owned another house to move into upon retirement, were ineligible for WFTC because the house was considered to be a second home.
But in October of this year, changes were made and these farmers can now claim the credit. "This is a great benefit, which has affected the large proportion of tenant farmers who have been prudent enough to cater for their retirement," says the TFAs George Dunn.
But accountant Grant Thorntons Carlton Collister points out that letting out the retirement house will count towards income, which could reduce the amount of credit received. "Farmers must also remember to fill out a self-assessment tax return each year."
More changes are in the pipeline, as the Chancellor introduced a new Working Tax Credit in his November pre-Budget report. This will be available to those without children, and a new Childrens Tax Credit is to be run separately.
The aim is to make the schemes simpler, but details will not be confirmed until the 2002 Budget and plans will not be implemented until April 2003.
For more information call the Tax Credit Helpline (0845-609 5000. *