TAXATION

UK Taxation



UK Taxation

Introduction

The study is related to the rules for deducting expenses from trading income and for deducting expenses from employment income in the view of the UK taxation. In UK taxation law is imposed on the employees income, taxation in the UK is at least at two levels that are the local government and central government through the Tax Office. Local government provides through state grants, taxes on commercial property, local taxes and, especially recently, due to such profits as a fee for parking on the streets. The content of the central government is mainly due to income tax payments on compulsory national insurance, VAT, corporate taxes and excise taxes.

Discussion

i) A bank manager voluntarily pays an annual subscription to a London club. He uses the club only for the purpose of meeting the bank's clients.

Against the employee's income for tax purposes, in the case that is the bank manager voluntarily pays an annual subscription to a London club. He uses the club only for the purpose of meeting the bank's clients. In this case the bank manager will not be allowed to have tax deduction as the bank manager is using the London club for the trading purpose with the aim of getting the trading income. Individuals who are tax resident in the United Kingdom are subject to taxation on their any income from any source and in any part of the world. The non-resident individuals are taxed only on U.K. source income as remuneration for services rendered United Kingdom, interest on bank accounts opened in the United Kingdom, etc. It is also important to note that tax residents are taxed on capital gains, while non - residents are also exempt as regards capital gains derived from the sale of shares of a U.K. company (Ahmad, 2007, 16-41).

A tax is a payment made to the government by an individual who has earned certain amount during a year. Income tax is a most important basis of income to the government. In other words it is an amount charged by a government on products, income, or activities. There are two types of taxes direct tax (which is charged on personal and corporate income directly) and indirect tax (which is charged on the prices of services and goods).

The above case is included in the cost of the sales that is income from the trading income. It is established that in the case of tax payers who do business, consider the cost in the amount of purchases of goods, decreased returns, discounts and bonuses on them, adding the cost to acquire these goods and leave them in terms of sale (Anderton, 2006, 7-26). In the case of tax payers engaged in activities other than commercial, considered only within cost of sales purchases of raw materials, semi finished products or finished products, decreasing the amount of rebates, discounts and allowances in the year. On the other hand, states that in all cases the cost will be deducted in the year to accumulate ...