SOCIAL SECURITY

Otago Daily Times, Issue 23687, 20 December 1938, Page 12

SOCIAL SECURITY

CHARGE FOR FUND EFFECT ON COMPANY SCHEMES EXPLANATION BY MINISTER (Per United Press Association) WELLINGTON, Dec. 19. " It has been brought to my notice that many companies are apprehensive of their position in regard to exemption from the social security charge of one shilling in the pound on that portion of their income which is contributed to staff superannuation funds," said the Minister of Social Security (Mr Walter Nash) in an interview to-day. " Many companies have established funds to which they have a contractual obligation to contribute, whether or not a profit or a loss has been made, whereas other companies have established funds, their contribution to which is solely dependent upon a profit being made or upon the making of an annual.grant by the company. " Where the superannuation fund has been approved by the Commissioner of Taxes the company is entitled to have its taxable income reduced by the amount of the contribution made by it to the fund whether or not the contribution is made under contract or voluntarily. I find, however, that in the case of companies making voluntary contributions to such fund there is some doubt as to whether the amount of the contribution will be deductable when computing the "(amount of income liable for the social security charge. " It is desirable that the same exemption in respect of these contributions should obtain in respect of the social security "charge as in respect of income tax, and I wish to assure companies that, where superannuation funds have been approved by the Commissioner of Taxes, whatever is necessary to secure exemption, whether it be by regulation or by legislation, will be carried out at the appropriate time."