Compare the similarities and differences for businesses and households in relation to taxation - Leaving Cert Business - Question 6(C) - 2022
Question 6(C)
Compare the similarities and differences for businesses and households in relation to taxation. Use any three of the following headings to structure your answer:
Co... show full transcript
Worked Solution & Example Answer:Compare the similarities and differences for businesses and households in relation to taxation - Leaving Cert Business - Question 6(C) - 2022
Step 1
Corporation Tax
96%
114 rated
Only available for registered users.
Sign up now to view full answer, or log in if you already have an account!
Answer
Certain businesses, especially limited companies, are required to pay corporation tax based on their profits. This is a tax on the revenue generated by the business, which is not applicable to households.
Step 2
PAYE
99%
104 rated
Only available for registered users.
Sign up now to view full answer, or log in if you already have an account!
Answer
PAYE (Pay As You Earn) is a system where households pay income tax directly from their earnings when they are employed or self-employed. Employers collect this tax from employees’ wages, while businesses, such as limited companies, do not pay PAYE on their profits.
Step 3
Capital Gains Tax
96%
101 rated
Only available for registered users.
Sign up now to view full answer, or log in if you already have an account!
Answer
Both households and businesses may incur Capital Gains Tax (CGT) when they dispose of an asset at a profit. If a profit is realized from the sale of an asset, the gain is subject to this tax, highlighting a similarity. However, discrepancies arise in how businesses report gains compared to households.
Join the Leaving Cert students using SimpleStudy...
