Child’s pay, adult tax

Press, 9 June 1986, Page 12

Child’s pay, adult tax

Sir, — I, a senior pupil of Avonside Girls’ High School, who holds a part-time position, would like to know why I am receiving a child’s wage, yet I am paying adult taxes. Is this a just system? — Yours, etc., NADINE BEDO. May 28, 1986.

[The Acting District Commissioner of the Inland Revenue Department, Mr R. G. Lynskey, replies: "In general terms, income tax is levied on income derived by all taxpayers regardless of their age. Although the rate at which income tax is payable is the same for a child and an adult, your correspondent, as a child, is entitled to a reduction of the tax payable by the allowance of a rebate, known as the child rebate. The amount of that rebate for income derived during the years ended March 31, 1986 and 1987 is $156. This means that a child can earn $7BO before income tax is payable for the year ended March 31, 1986, and $B9l before income tax is payable for the year ended March 31, 1987. PAYE tax is deducted at source from earnings at the normal rate and the rebate claimed when the annual return of income, IR 5, is furnished at the end of the financial year. Any tax paid in excess of that correctly payable is then refunded.”]