What is taxation?

Assessment

In your Assessment at the end of this Unit, you will be asked to:

  • Research the current guidelines regarding tax, National Insurance and Value Added Tax (VAT) liabilities.

This will help you to satisfy learning outcome 3.2 for this Unit. As you work through this Session, you will find lots of useful information to help you complete this part of your Assessment.

Click to take a look at the diagram showing the different types of tax payments we make to the Government.

Tax Payments

Tax payments diagram

Income tax is the largest source of tax revenue that is collected by the Government. The second largest source of tax revenue is National Insurance Contributions. The third largest source of tax revenue is Value Added Tax (known as VAT). Finally, Corporation Tax is the fourth largest source of revenue.

We will take a look at each of these types of taxation in more detail during this Session. Let’s begin with income tax - move on to page 3 to find out more.