I am sure you know the obvious different taxes: Income Tax, Corporation Tax, Capital Gains Tax, VAT, Stamp Duty Land Tax and Inheritance Tax – they affect us at some time in most walks of life.
But what about the not so obvious ones that still affect our daily lives: petrol, beer, Insurance Tax, Travel Tax and so on and so on.
Hold on, if you think we have exhausted the list, here are a couple of the more ‘obscure’ taxes:
- Under UK tax law biscuits and cakes are deemed as necessities and are not subject to VAT. Chocolate covered biscuits however, are luxury goods and taxed at 20%. This forced McVities to go to a tribunal and prove that Jaffa Cakes are cakes – in case you’re wondering they won (as, more recently, did the manufacturers of “snowballs”)!
- Toasted sandwiches are fixed with a 20% tax charge but toasted bagels and baguettes are exempt. This prompted Subway to get a petition started to remove the tax as they deemed it unfair. Unfortunately for them they lost this one.
There is no official answer but our estimate is that there are over 100 different taxes applicable in the UK – if you know the exact number we’d love to hear from you. Each of these consist of hundreds of pages of rules and regulations – remember the latest Finance Act comprised of 646 pages! This underlines how complicated our tax system is. Even as accountants we sometimes despair at how complicated our tax system is – trust me it is much more fun to discuss ideas with our clients on how they can develop their business than discussing and explaining all the various tax rules.
If you like the way we think – you will like the way we work.
AIMS Accountants for Business are the largest independent association of professionally qualified accountants in the UK specialising in accountancy for small, local and independent businesses. AIMS are no ordinary accountants and we are more than just number crunchers! Find your local AIMS Accountant.