Types of Taxation in the UK

There are different types of taxation in the UK depending on whether you are employed, in which case you are taxed on a pay as you earn basis, self-employed, or running a business. Within the broader spectrum of taxation, there are deductions from earnings, and value added tax or vat that is charged on certain goods and services.

In the UK beside’s the company owner’s personal taxation, he or she also has to pay corporation tax, which is an extra tax on business. Everything employment and earnings related is taxed in the UK and the system for taxing company benefits is quite complicated as it is being continually updated.

If your parents were wealthy or have managed to save more than a certain amount, then when they pass on you could be subject to inheritance tax – that is to say a tax on any benefits you may have accrued, over a certain amount, as a result of your parents’ demise. Everyone pays the basic rate of tax once they earn over a hundred pounds a week, those who earn more than a specified figure will pay a higher rate of tax than most ordinary workers.