Business Taxation: Trading Profits, Self-Employment, VAT Schemes

Business
Taxation

Table of Contents
INTRODUCTION...........................................................................................................................3
QUESTION 1...................................................................................................................................3
Linda's trading profits for the year 31st march 2121:..................................................................3
QUESTION 2...................................................................................................................................5
Criteria for the use for employment for self employment, why people prefer self employment:
......................................................................................................................................................5
QUESTION 2...................................................................................................................................6
Discussion Six badges for trade:..................................................................................................6
Different VAT schemes for the various VAT registered companies:..........................................8
CONCLUSION..............................................................................................................................11
REFERENCES..............................................................................................................................12

INTRODUCTION
Business taxation are the process for taxes which businesses pays for normal activities for
the business. The income tax which companies pays for its activities shows business tax.
Companies pays tax for the government as per the tax rules. The business tax government makes
for sole proprietor, partner, limited company, corporation, businesses are responsible for pay tax
rules. Business tax are the direct tax which apply for the net profits for the company. These taxes
businesses pay for their income for the government. For example, businesses pay taxes for the
tax rules (Al Karaawy and Al Baaj, 2018). This report is bases for business taxations. This report
includes topics which are trading profits, self-employment, six badges for trade, VAT schemes
for the various VAT businesses etc. Apart from this it includes topics inheritance tax, capital
gain tax liability etc.
QUESTION 1
Linda's trading profits for the year 31st march 2121:
Trading profits are equivalent for the earnings from its activities. It’s not includes
financing related income, expenses for the gains for the assets. It tends for the higher indicator
for the ability for the core activities for businesses in order to increases its profitability. The
profit that an investor drives for the purchase, sales for the securities. Trading profits are
substantial for the investor which knows the risks includes in the deals for the business. These
profits make for purchase, sales for the goods, services. This statement shows not allowable
transactions for the businesses which shows trading profits. Trading profits are providing
business profits for income, expenses which are not allowable for the businesses (Arnold, Ault
and Cooper, 2019). These profits which helps businesses for earnings for their activities which
helps business for accomplish objectives.
In accounting there are various terms which helps managers for financial decision
making. Accounting department records transactions for helps business for accomplish its
objectives. Accounting department prepares various financial statement which helps them for
keeping records. These records help them for finance arrangement, managing funds for the
activities which runs in business for accomplish objectives. Financial statement includes trading,
income statement, balance sheet for activities includes in business (Biddle, Fels and Sinning,
2018) (Blakeley, 2018). Trading account shows direct expenses which includes when the

business runs its activities. Trading account which are organised for establish business
transactions for manager’s decision making. Trading, income statement is useful for the gross
profits, net profits which business earns. It shows the relationship between sales and gross profits
which helps for assessing profitability for the business. It shows the relation for costs of goods
sold, gross profits (Boadway, Sato and Tremblay, 2016). Trading account provides the
information related for trading activities. Trading profit account shows various terms which
includes expenses, income for the business.
Trading profits (before deduction for capital allowances)
Particulars £ Amount
Net profits per accounts 6 9 6 0
Add: Expenditure which shows in the income
account but not allowable
Rental income 1200
Depreciation 2500
Installation of new improved heating system 3800
Telephone costs 220
motor expenses 650
Business entertaining 520 8890
Deduct
general bad debts provisions 2 0 0
Bank interest receives 8 0 280
Trading profits 15570
The sales, cost of goods sales appear as the normal trading items.
 The rental income for company purchase for the main Corporation Tax computation as
the property income.
 The bank interests receive are not subject for Corporation Tax.
 Salaries and Wages (including employers’ NIC) are allowable.
 Depreciation is never allowable.
 Director’s fees are treated in the same way as other staff salaries.