(solved) Taxation Assignment PDF
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Added on 2020-09-17
(solved) Taxation Assignment PDF
Added on 2020-09-17
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TAXATION
Table of ContentsINTRODUCTION...........................................................................................................................1PART 1............................................................................................................................................1PART 2............................................................................................................................................3(A)...........................................................................................................................................3(B)...........................................................................................................................................3PART 3............................................................................................................................................5(A)...........................................................................................................................................5(B)...........................................................................................................................................7CONCLUSION................................................................................................................................7REFERENCES................................................................................................................................8
INTRODUCTION In order to promote public welfare and economic growth, UK has a taxation systemwherein various kinds of taxes are being charged by the government such as income tax,corporate tax, capital gain tax and many others. UK government obtain maximum revenuethrough income tax evidencing it from the year 2016/17, it had collected total of £182 billion(Income tax, 2016). Income tax is levied by the government on personal income of theindividual. It follows progressive structure wherein as the level of income increases, tax ratesalso goes up. The current assignment study will apply various taxation rules and regulations todetermine tax liabilities. PART 1Personal tax computationAs per the case study provided, Nina Simon (Aged 43) had married Patrick (Aged 46)and has two children, Suzie (aged 16) and Anthony (aged 14). Patrick is playing the role ofadministrator and dealing duties around payroll, bookkeeping and debtor/creditor management.According to the draft budget, expected budgeted figure for the year ended 5th April 2017 is£198,300 and Patrick is getting a salary of £28,000 during this period. Personal tax liability ofboth Nina and Patrick is performed below:For taxation year 2016/17, sole trader’s tax-free allowance is £11,000 but subjected to therestriction that income must not go beyond the total limit of £100,000. The tax band for the soletrader is as follows:BandTaxable incomeTaxation rateBasic rate£0 to £32,00020%Higher rate£32,001-£150,00040%Additional rateOver £150,00045%Being a sole trader; it is necessary for Nina to register herself under National InsuranceContribution with HMRC (Her Majesty Revenue and Custom) and pay class 2 & class 4 NICs ifprofit goes beyond the limit of £5,965 and £8,060 a year for FY 2016/17. Personal tax contribution of Nina SimonParticulars Working Amount Expected trading profit for theyear 2016/17£198,300Page 1 of 12
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