Taxation in the UK

Tax is usually imposed by the state in order to gain income and finance various actions carried out by the actual goverment or the state.
As in other developed countries, in the United Kingdom taxation involves certain types of taxes such as income tax and value added tax (VAT), which is the main source of income for the state and others like corporation tax, fuel tax, capital gain tax or inheritance tax, just the mention the most important ones.

The period of a tax year in the UK does not correspond with a calendar year, but from 6 April until 5 April the next year, which is somtimes also called a fiscal year. The state also gives tax advantages for certain investments such as businesses or pension schemes in forms of reduced corporate tax or tax exempt pension contributions. Up to a certain amount the general income tax also has a tax allowance, which, however changes annually, so it is recommended to check it before making the annual tax return.

Every good or service sold or provided in the country has a value added tax included in its price, which is currently 17,5%, however for certain goods may have a reduced VAT of 5% or might be fully tax exempt as well.
Some goods have higher taxes levied on them which are called excise duties, such as tobacco alcohol or gambling.