Taxation worksheet

Income tax

Tax on earnings, profits from investments, and any other sources of personal income.

Capital gains tax

Tax on profits made by selling assets such as businesses, rented houses, and shares.

Value added Tax (VAT)

Tax on goods and services, charged at 17.5% in the UK.

Stamp duty

Tax on specific transactions, payable by the buyer of a house in the UK.

Wealth tax

Tax on assets, such as houses, payable in some countries but not in the UK.

Inheritance tax

Tax on the assets of a deceased person, formerly known as "death duties."

Corporation tax

Tax paid by companies.

Tax relief

The system of allowing someone not to pay tax on a part of their income.

Tax break

A change in the law that results in the opportunity to pay less in taxes.

Tax exile

A person with a high income who moves to another country with lower taxes.

Direct taxation

Tax burden directly imposed on individuals.

Indirect taxation

Taxes paid by consumers when purchasing goods and services.

Tax avoidance

The use of legal methods to minimize the amount of income tax owed.

Tax evasion

Illegal act of evading paying taxes.

Tax free

Services that are not taxable.

Exempt from VAT

Not charged VAT.

Tax bracket

The range of incomes taxed at given rates.

Tax incentive

A reduction in taxes that encourages companies or people to help the country's economy.

Tax rebate

Money paid back to a person or company when they have paid too much tax.