Partner Article

Many happy (tax) returns!

At the Conservative Party conference earlier this week, David Cameron announced plans for some married couples to get tax breaks worth up to £200 a year.

The Prime Minister said that around four million couples would benefit from a £1,000 transferable tax allowance from 2015.

But here’s the catch - the tax break will be means-tested, and only apply if couples are basic rate tax payers, and one spouse earns less than the personal allowance.

However, in their rush to restrict the availability of the allowance to those who may regard as deserving it, the Conservatives are at risk of creating something of huge complexity and limited value.

Notwithstanding the LibDems commitment to reducing the number of people required to complete a tax return, introducing another means-tested allowance will inevitably require more tax returns.

It is estimated that the Child Benefit withdrawal alone will require another 500,000 people to complete a tax return every year.

My guess is that this new means-tested ‘married couples allowance’ may bring in a further 500,000 people; couples with no children or whose children have grown up. Now that’s a lot of paper…

This was posted in Bdaily's Members' News section by George Bull .