HND-所得税模版.docx

1,(1)contract of service and contract for service (2) Factors which may be important to consider: One: The degree of control exercised over the person doing the work Two: whether the worker must accept further work Three: whether the person who has offered work must provide further work Four: whether the worker provides his own equipment Five: whether the worker is entitled to employment benefits such as sick pay, holiday pay and pension facilities Six: whether the worker hires his own helpersSeven: what degree of financial risk the worker takes Eight: what degree of responsibility for investment and management the worker has Nine: whether the worker can profit from sound managementTen: whether the worker can work when he chooses Eleven: whether the worker works for a number of different people or organizations Twelve: the wording used in any agreement between the worker and the person for whom he performs work. (3) application of the above principles to Katy: Control/unable to commit to working specific hours/ does the work when she can/ record time spend on clients / self-employmentFinancial Risk/ now subcontracts small jobs/ records time spend one each clients and invoices the accountants for her hours worked at agreed hourly rate / self-employmentEquipment/ the firm has given Katy one of their PCs to do her work (1mark) / employment Work performance and correction/ now subcontracts small jobs (1mark) / self-employmentHolidays and sickness / would then have been entitled to holiday and sickness pay (1mark) / self-employment Exclusivity/ she does no other paid work / employmentDecision: Katys employment status is more close to Self-Employment according to above tests2 (1) taxable persons :Individuals, partners and trust resident in the UK are charged to income tax on their income. To be more specific, taxable persons refer to those who can obtain income, corporation revenue, capital gains, inheritance and added value.Both UK and non-UK residents is taxed because in respects of his property in the UK and he enjoys the benefits of our laws for the protection of that property.Residence are those who spends more than six months in the UK( 183 days) or who has established permanent resident abroad will be regarded as resident in the UK if they visit the UK for more than 91 days in the tax year. (2) tax year : tax year refers to the period from 6th April to following 5th April.(3) self-assessment system of submitting tax returns and payment of tax:One: Self Assessment is a system HM Revenue and Customs (HMRC) uses to collect Income Tax.Two: Conditions for submitting tax returns:You need to send a tax return if, in the last tax year: you were self-employed - you can deductallowable expensesyou got 2,500 or more in untaxed income, eg fromrenting out a propertyor savings and investments -contact the helplineif it was less than 2,500your savings or investment income was 10,000 or more before taxyou made profits from selling things like shares, a second home or otherchargeable assetsand need to payCapital Gains Taxyou were a company director - unless it was for a non-profit organisation (eg a charity) and you didnt get any pay or benefits, like a company caryour income (or your partners) was over 50,000 and one of you claimedChild Benefityou hadincome from abroadthat you needed to pay tax onyoulived abroad and had a UK incomeyou gotdividends from sharesand youre a higher or additional rate taxpayer - but if you dont need to send a return for any other reason,contact the helplineinsteadyour income was over 100,000you were a trustee of a trust or registered pension schemeCertain other people may need to send a return (eg religious ministers or Lloyds underwriters) - you cancheck whether you need to. You usually wont need to send a return if your only income is from your wages or pension.If you get an email or letter from HM Revenue and Customs (HMRC) telling you to send a return, you must send it - even if you dont have any tax to pay.Three: deadlines for tax return:There are deadlines for sending your Self Assessment tax return to HM Revenue and Customs (HMRC) and paying any money you owe.The last tax year started on 6 April 2014 and ended on 5 April 2015.Self AssessmentDeadlineRegister for Self AssessmentYou should register by 5 October 2015Paper tax returnsMidnight 31 October 2015Online tax returnsMidnight 31 January 2016Pay the tax you oweMidnight 31 January 2016Four: Payment of tax: Under PAYE, income tax is normally paid over to HMRC monthly, 17 days after the end of the tax month ( if paid electronically ) or 14 days after the end of the tax month ( if paid by cheque). Large employers with 250 or more employees must make electronic payments. (4)the application of interest , surcharges and penalties:Daily interest is charged on late payment of income tax under PAYE by taking the number of days by which a payment is late and applying the relevant late payment interest rate. HMRC make the charge after the end of the tax year.Late payment penalties may be charged on PAYE amounts that are not paid in full and on time. There will be no penalty if there is only a small underpayment, and penalties will be charged on a risk-assessed basis rather than automatically. Employers are not charged a penalty for the first late PAYE payment in a tax year unless that payment is over six months late. The amount of penalties on late payments depends on how much is late each time and the number of times payments are late in a tax year. The maximum penalty is 4% the amount that is late in the relevant tax month and applies to the 11th late payment that tax year. Where a penalty has been imposed and the tax remains unpaid at six months, the further penalty is 5% of tax unpaid, with a further 5% if tax remains unpaid at 12 months. A surcharge of 5% will be applied to tax unpaid 28 days after the due date with a further 5% applied 6 months after the due date.3, (1) basis of assessment: people will be taxed on the following things:Money earned from employmentProfits they make if they are self-employedSome state benefits Most pensions, Interest on savings and pensioner bonds Rental income Benefits they get from job Income from a trust Dividends from company share. (2) tax code: the tax code is used by the employer or pension provider to work out how much income tax to take from the pay or pension. The code is worked out by HMRC who sends it to your employer or pension provider. the composition of tax code :Number: how much income you can have before you pay tax. ( it indirectly indicates the personal allowance). For example: 10,600 can be deducted from the income, so the number is 1060. (10,600/10). ( divided by 10) Letter: one letter: it indicates the situation and how it affects your tax-free personal allowance. The meaning for the letter in tax code :L: you are entitled to the basis tax-free personal allowance which means the people must be born after 5 April 1948.P: tax code for people born between 6 April 1938 and 5 April 1948M: marriage allowance. If you have received a transfer of 10% of your partners personal allowance scheme.N : it indicated that you have transferred a 10% of your pension to your partner. Y: your were born before 6 April 1938 or over and entitled to your bigger full tax-free personal allowance.T: your tax code includes other calculations to work out your personal allowance. Eg it has been reduced because your income has already exceeded the amount for basic rate tax(3)the operation of PAYE: Employers must report PAYE information to HMRC under the Real Time Information(RTI) system.Under RTI, an employer is required to submit informati