Place the cream cheese and butter in a large bowl; beat with electric mixer until smooth and creamy. Beat 1/2 cup of icing sugar into the butter mixture. Slowly beat in the flour; mix well. Cover bowl and refrigerate at least 3 hours, or overnight.
Preheat an oven to 190 degrees C.
On a well floured board roll out chilled dough to 3mm. Use a pizza wheel to cut dough into 5cm squares. Spoon approximately 2 teaspoons of filling in the centre of each square; do not overfill.
Fold opposite corners of each square into the middle to encase dough, pinching dough together in centre. Filling should peek out a little at each end. Transfer biscuits to an ungreased baking tray.
Bake the biscuits in the preheated oven until set but not brown, about 12 minutes. Remove to racks to cool. Dust cooled biscuits with remaining icing sugar.