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Introduction To Module Week 1

The document discusses the key aspects of a module on the UK tax system, including the focus on income tax and VAT, the assessments for the module consisting of a class test and exam, the first assessment being a class test on November 3rd, the differences between direct and indirect taxes, tax years for individuals and companies, allowances that are deductible from or reduce tax, personal allowance restrictions based on adjusted net income, and the differences between occupational and personal pension schemes.

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Bhanu Teja
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30 views2 pages

Introduction To Module Week 1

The document discusses the key aspects of a module on the UK tax system, including the focus on income tax and VAT, the assessments for the module consisting of a class test and exam, the first assessment being a class test on November 3rd, the differences between direct and indirect taxes, tax years for individuals and companies, allowances that are deductible from or reduce tax, personal allowance restrictions based on adjusted net income, and the differences between occupational and personal pension schemes.

Uploaded by

Bhanu Teja
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd

1. What is the focus of this module?

The main focus of this module is on Tax system in UK, computation of Income tax
and introduction to VAT system.

2. What are the assessments for this module?


This Module will be assessed through a Class test (40%) and an examination (60%).

3. In what week is the first assessment due?


The first assessment is a class test that will conducted on 03/11/2021 through online
for a period 3 hours

4. Differentiate between direct and indirect tax?


 The direct tax is collected directly from the person, Generally Direct tax is
levied on incomes and gains/profits.
Examples: Income tax, corporation tax
 The indirect tax is the collected indirectly from one person through an
intermediary. In majority of cases ultimate Burden of Indirect tax is on end
user.
Examples: VAT, Excise Duty, Customs Duty

5. Explain your understanding of tax year for individuals and for companies?
 For Individuals:
Tax year starts from 6th April and ends on 5th April also known as year of
assessment
 For Companies:
Tax year starts from 1st April to 31st March also referred as financial year.
6. List TWO allowances which are deductible from total income and TWO
allowances which are tax reducers
Allowances that are deductible from total income
 Personal allowance
 Blind person allowance
Allowances that are tax reducers
 Marriage allowance
 Marriage couples’ allowance
7. When is PA restricted and how do you calculate ANI?
 Personal allowance is restricted only when Adjusted Net Income (ANI) is
above £100,000 and it is reduced by £1 for every £2 over and above
£100,000.
 ANI: Net income reduced by Gross Gift Aaid and Gross personal pension
Contributions is ANI

8. What is the difference between occupational pension scheme and personal


pension scheme?
 Occupational pension: It is arranged by the Employer types Defined
contribution scheme and defined benefits scheme. Here, employee
contributions do not form part of salary i.e. deducted from salary.
 Personal pension scheme: Here the Employer do not set any pension,
scheme the employee gets his pension scheme on his own.

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