Unit 1 Investigating Small Business Tax

Question 1

Records

Answer 1

Evidence of what has happened in the past; records could be kept in paper form or in computer files for example.

Question 2

HM Revenues and Customs (HMRC)

Answer 2

The government authorities in the UK responsible for collecting tax.

Question 3

VAT (Value Added Tax)

Answer 3

A tax on the value of sales: it is paid by businesses to government.

Question 4

Income tax

Answer 4

A tax on the value of income earned by workers; this includes sole traders who have to pay income tax on their net earnings.

Question 5

National Insurance Contributions (NICs)

Answer 5

A tax on the earning of workers; Employers’ National Insurance contributions are paid by employers on the wages of their workers; employees and sole traders have to pay National Insurance contributions on their earnings.

Question 6

Corporation Tax

Answer 6

A tax on the profits of limited companies.