Gloria Mitchell, on Jul 1 2007, 08:03 PM, said:
Then how come, in my understanding from others, Winz do claw back those allowances? Do you have documentation that could help others?
Gloria
I am well aware that WINZ are claiming these allowances back - but they are acting outside the law in doing so. WINZ and ACC collude to cover this up by failing to fully account on payments made to the WINZ / ACC client. I note ACC state they will deal with Allan's repayment to WINZ by review. DRSL do not have jurisdiction, and in any event - its WINZ matter.
I have had my accountant working on this for the eventuality of when, if ever, I receive backdated ERC. Mini has also been working on the same issue from a different angle. Once her TRA case has been heard - things may change?
My legal argument is based on what ACC and WINZ are doing is contrary to the Income Tax Act. Backdated ERC is treated by IRD as income in the taxation year in which it recieved by the claimant. Thus, 5 years back dated ERC received this month counts, in total as this years income only and is taxed accordingly. Thus, in this example, ones income is 5 times higher than normal for on year - and higher rates of taxation apply.
Conversely, ones "retrospectively corrected" income for the preceding 4 years does not increase, in fact it decreases as the basic benefit, which is taxable income, must be repaid under the Social Security Act.
Thus - ones ellegibility for the non taxable accommodation allowance for the preceding 5 years has not changed, thus is
not repayable.
Likewise the same argument applies to any special benefit recieved.
The disability allowance is a non taxable allowance paid to meet specific medical costs. These should have, at the time, been meet by ACC but were not. Thus - is any repayment of this allowance is made - it must be by ACC -
not the claimant.
I have had experience in taxation law and this legal position is supported by my accountant. However, I have not yet found anyone about to recieve backdated ERC payents prepared to take on ACC and WINZ on this issue. This issue has been coverd in postings by Mini.
Anybody needing any help contact me off forum.