module specification

Module title: Principles of Taxation
Module code: AC5004
Module description:
The module will examine the theory underlying  taxation and issues relating to current taxation practice
It will provide students with the knowledge to prepare personal and company tax computations. Students will also examine the principles of capital gains tax, inheritance tax and value added tax.

Assessment will consist of 3 components:
1) 2 x 1 hour In-class tests. (20%)
2) A case study based on a given scenario, 1000 words (20%)
2)  3 hour closed book examination (60%)
 

The module aims to introduce students to UK personal and business taxation based on the current Finance Act. The module deals with the fundamental principles of UK tax law and practice , including the computation of the tax liability for a variety of taxpayers. Students wil be able to prepare more complex tax computations, identify tax planning opportunities and relate them to their own tax circumstances.
The module also aims to develop students in the acquisition of the following skills:
1. Academic reading and writing
2. Analysing of data
3. Researching
4. Application of knowledge and presenting data
5. Self assessment and reflection

1. Introduction to the UK tax system.
2. Income tax computations for taxpayers in a variety of circumstances.
3. Trading income , including basis periods, trading losses and capital allowances.
4. Partnership taxation (basis periods and notional losses).
5. Income and benefits in kind from employment and NIC (employed and self employed contributions).
6. Income from property .
7. Capital gains tax for individuals.
8. Corporation tax computations.
9. Company loss relief , group relief and capital gains.
10. Value added tax.
11. Incorporation, as part of tax planning for small businesses.
12. Taxation theories underlying the practice of taxation in the UK.
13. International taxation issues.
14. Inheritance taxation issues. 

Teaching will take the form of a weekly one and a half hour lecture and one and a half hour seminar programme. The lecture will provide a broad outline and context for each subject area with examples to identify key areas, in depth and pre-distributed to students.

The seminar programme will use practical problem solving questions, pre-distributed to allow the student to attempt questions in advance.

On successful completion of this module, students will be able to:

1. Identify and critically examine the bases and objectives of taxation, the characteristics of an ‘ideal tax’ and the main sources of tax law and practice;
2. Demonstrate an understanding of the tax treatment of investment income, employment income (including benefits-in-kind and termination payments), self employment income (including capital allowances) and obtain relief for expenses where possible;
3. Compute the income tax liability for individuals and give basic tax advice;
4. Prepare corporation tax computations, including loss and group relief;
5. Demonstrate an understanding of the exemptions and reliefs which are available in computing capital gains tax;
6. Identify the main features of VAT.
7. Critically examine the theoretical base for taxation in the  UK

Assessment consists of 3 components:
1) 2 x 1 hour In Class Tests, consisting of multiple choice questions and short answer questions. (Learning outcomes 1 ,2 and 3) (20%)
2) Case study based on a given scenario for Corporation Tax, 1000 words, (Learning outcomes 4 and 5), (20%)
3) 3 hour, closed book examination, at the end of the year (All Learning outcomes) (60%)
The 3 hour exam is required in order to obtain exemptions from the professional bodies exam (ACCA,CIMA and ICAEW)

Overall pass mark 40%
 

Essential  texts:

• Taxation, (current finance act); Alan Melville; FT Prentice Hall
• The Economics of Taxation; S. James and C. Nobes; latest edition, FT Prentice Hall

www.hmrc.gov.uk

These texts will be supplemented by other texts; web sites and key articles .