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The Role of Direct and Indirect Taxes in the Federal Reserve - Essay Example
Finance & Accounting
Pages 10 (2510 words)
Instructor Date UK Taxation System Part 1 Income tax Scope Income tax in the UK relates to tax charged on individuals and partnerships. An individual’s liability to UK income tax is determined by whether the individual is resident or ordinarily resident in the UK…
i. Present in the UK for a minimum of 183 days ii. Not habitually in the UK but makes substantial visits averaging a minimum of 91 days a year in each of four or more consecutive years. For anyone who may be emigrating from the UK, the number of years is three instead of four. However, if there are extenuating circumstances such as illnesses the days are ignored for the 91 day rule but not for the 183 day rule. Ordinary residence indicates a higher degree of permanence when compared to residence. An individual is considered to be ordinarily resident if residence in the UK is of a habitual nature. Therefore, if that person goes abroad for a period constituting a full tax year the individual is regarded as remaining a resident and ordinarily resident during the period of absence. What is taxable? A UK resident is normally liable for taxation on income earned both in the UK and overseas. A non-resident however is only liable to pay UK income tax on income earned in the UK (BPP Learning Media 2009). Income from several sources is brought together in an individual’s personal tax computation. These sources include: non-saving - income from employment; saving income - building society interest and national saving and investment interest; and dividend income - income received for investment in company shares. ...
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