Define and describe what is meant by ‘tax’ and its importance to organisations and governments.

Assignment Brief

You are an International Tax Consultant and have been hired by [Tina & May Europe TME).The owners are starting up a small business and they would like to have more information on taxation, namely on the taxation systems available and what their ethical and legal responsibilities would be. They would also like information on international taxation systems, with particularly reference to (VAT Trade Blocs and EFTA) which may impact on their business so these will need to form part of the informal report you have been asked to prepare.

The report must contain the following:

Task 1. Define and describe what is meant by ‘tax’ and its importance to organisations and governments.

( Use updated figures )

Income Tax: Employees point of view. Employer (Self employed) E.g. their profits after their adjustments.

– Rates of Taxes and how its calculated.

– Other taxes, national insurance,

– What are examples of taxation?

– HMRC

– Canons of taxation

– Customs on goods from abroad.

Task 2. Examine taxation systems in detail and consider taxation legislation that will have a given implication on national taxation.

Notes for task 2:

Taxation they might need to deal with straight away, e.g PAYE for income tax, national insurance ( different thresholds . ( May want to use business rates.)

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Local taxes set up by local government ( England0.

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VAT – When do you register at what rate?

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EU members don’t have to pay VAT if they’re both registered for VAT.

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Imports would have to pay customs excise duty at the ports.

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VAT rates apply in UK.

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National insurance rates/

D1 criteria: Look at VAT: Regressive, not taking earnings into consideration.

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No accountability to pay

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Another system

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Link with canons of taxation, does it meet the criteria.

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Any TAX must be fair.

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Everyone pay equal share tax.

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Must be collectable

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Easy to understand

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Less rules.

Task 3. What are the key ethical and legal constraints that affect organisations? Evaluate the impact of these for different organisations.

Notes for task 3: What happens if businesses don’t register for e.g VAT, Income tax, National insurance from a legislation pint of view.  ( Penalties of not paying)

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Fines, warnings, interests, shut businesses.

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Don’t run payroll effectively, Don’t fill out self assessment, what are the consequences.

D3 Criteria notes:

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To minimise regulation would have to have one tax rate on every item.

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Don’t collect enough tax for everyone.

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TAX payers alliance / What does Adam Smith Institution say?

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