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Taxation in UK - Essay Example
Author : schadennicolett
Finance & Accounting
Pages 12 (3012 words)
The research paper throws light on the taxation. Particularly this research aims to evaluate and present income tax; corporation tax; taxable and tax rate; direct tax and indirect tax; income and corporate tax system in United Kingdom…
The paper tells that the Largest source of revenue collection for government is income tax. Everyone in the country has an income tax personal allowance below which he does not have to pay tax in a particular tax year. For people aging below 65 years have a tax allowance of £6,475 in 2010-11. However, in June 2010, this figure has been increased by £1,000 by the Chancellor therefore the tax personal allowance is £7,475. If anyone has an income below the income tax personal allowance, he is not supposed to pay any tax however if the earnings of an individual is above the tax allowance then he is supposed to pay according to his earnings above this level. There are different tax bands and every tax band has a different tax rate. Corporation tax refers to the tax on the profits made by the organizations in United Kingdom along with profits made by permanent establishments of companies owned by non-UK residents as well as associations trading in European Union. Collection of corporate tax is the fourth largest source of revenue collection of government. Before April 1965, both the corporate tax rate and individual tax rate were charged at the same rate though corporations were supposed to pay an additional profit tax. However, with the passage of time, there have been several changes to the corporate tax and since 1997, the laws have modified several times and now the tax rates of corporations and individuals have changed. ...
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