Taxation

This module introducing the main principles of UK taxes for corporate bodies and individuals. The scope of taxes includes Corporation tax, Capital tax, personal taxation (whether as an employee, sole trader or partner in an unincorporated business, Inheritance taxes and Value Added Tax (VAT).

By the end of this module the student should be able to:

1. prepare tax computations showing trading profits and losses for an unincorporated business.
2. demonstrate an understanding of Value Added Tax; and when VAT is chargeable and recoverable by a business;
3. prepare capital gains tax and inheritance tax computations; understand and calculate the effect of ordinary residence and domicile on UK tax liabilities;
4. prepare computations showing the profits chargeable to corporation tax for UK companies;
5. prepare computations showing the offset of losses in UK companies and effectively apply the rules available within related Groups companies.

1 Trading Income

The nature of business profits assessable under the UK tax system. The computation of taxable profits and basis of assessment.Setting-off of income tax losses for businesses run by sole traders and partnerships.

2 Taxation of the Individual

Independent taxation. Sources of income including benefits in kind. Personal allowances and reliefs. Losses arising from property income Value Added Tax Principles, outputs and inputs, exemptions, zero rated, partly exempt businesses.

3 Corporation Tax and Corporate groups

Compilation of income assessable including capital gains. Rates of tax. Financial years and payment of tax. The effects of close company status.The use of losses in a single company context. The treatment of groups of companies and consortia. The application of capital gains tax provisions on transactions of companies.

4 Management of Personal Taxation

Calculation of capital gains/losses and liabilities arising on disposals. Principles of inheritance tax and treatment of liabilities arising on lifetime gifts and on death. Inter-relationship of taxes and identification of opportunities to minimise or defer taxation liabilities.

5 Tax planning and Overseas Taxation

Inter-relationship of taxes, planning, anti-avoidance and tax management. Overseas aspects of personal and corporate taxation.