4. System of UK Tax Compliance

Question 1

UK Tax Compliance

Answer 1

1. Taxed at source through PAYE
2. Self Assessment (tax return)

Paper tax return must be filed by 31st October following end of tax year

Electronic tax return must be submitted by 31st January following end of tax year

Question 2

Self-employed Tax Compliance

Answer 2

Self-employed (or pay less than 80% of last years income tax at source), need to pay 2 equal payments:

31st January in the tax year
31st July following end of tax year
Final balancing payment 31st Jan following tax year

Question 3

Tax Avoidance and Evasion

Answer 3

Avoidance - legally structuring affairs for lowest possible tax bill

Evasion - deliberate actions to evade paying proper and full amount of tax

Total amount payable by offender is tax due + statutory interest (for late tax) + penalty