TAXATION

1. TAX

A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures. A failure to pay, along with evasion of or resistance to taxation, is punishable by law.

2. Allowable Deductions

Any expenditure that can be deducted from gross income to reduce the amount subject to income tax before calculating how much tax is due.

3. Assessable Income

The amount of money considered when calculating tax payments.

4. Asset

Something with value that you own outright or have an interest in (such as a leasehold)

5. Audit

Official inspection of your organisation’s accounts.

6. Beneficiary

The individual who receives benefits from certain acts. For example, the beneficiary could be a person entitled to benefits from a trust property.

7. Benefit-in-Kind

Benefits-in-Kind are benefits employees or directors have that are not included in their salaries. They include things like company cars, private medical insurance or free accommodation. These are benefits that an employee receives that cannot be converted into cash but have a cash value.

8. Capital Gain

The profit from the sale of a capital asset. Example: Asset such as land, buildings and shares.

9. Capital Gains Tax (CGT)

A type of tax levied on the profit from the disposal of an asset. Tax on gains that arise on the sale of capital assets, items such as land, buildings and shares.

10. Corporate Income Tax

A type of tax levied on the income of corporations, usually imposed at the national level.

11. Creditor

Person or company to whom money is owed

12. Deduction (tax)

A reduction in tax obligation from the taxpayer’s gross income. Deductions are removed from taxable income and thus lower tax liability.

13. Dependant

Individual who relies on another; for example a child or disabled family member.

14. Dividends

Sum of money regularly paid by a company to shareholders from its profits.

15. Domicile

Permanent home country of a person or the country they live in and have substantial ties with.

16. Duty-Free Zone

A zone where merchandise can be brought in without import duties.

17. Excise Tax/Duty

A tax on the sale of particular goods 

18. Exempt Income

Used to describe types of income not subject to income tax.

19. Flat Tax

A tax system with a constant marginal rate.

20. Gross Income

The amount of income paid to an employee before any deductions are made.

21. GST

Goods and Services Tax is an Indian indirect system of tax . The act came into effect on 1st July, 2017. It is a value-added tax which is levied on manufacture, sale and consumption of goods and services.

22. Health Expenses

The amount spent on a diagnosis or treatment of medical problems. You may be entitled to a refund of some of the amount you paid for qualifying medical expenses.

23. Inheritance Tax

The beneficiary to an inheritance must pay this tax. If you are a surviving spouse or civil partner receiving inheritance from your deceased spouse however, the inheritance is exempt and not liable to the tax.

24. Local Property Tax (LPT):

A self-assessed tax paid annually by homeowners on the market value of residential properties

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25. Net Income

The total income after any deductions have been made.

26. Notional Pay

The value of any non-cash benefit or perquisite.