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1. (two words) The amount of income subject to income tax ___________
2. (two words) A part of income which a person is allowed to earn and not to pay tax on ___________
3. (two words) A reduction in tax liability allowed for a particular reason
___________
4. (two words) The total amount of tax that a person or organization must pay
___________
5. To establish and apply as compulsory ___________
6. (two words) A threshold above which income tax is levied ___________
7. Reductions in the amount of tax for particular groups ___________
8. (two words) The return by the government of the difference between taxes paid and taxes owed ___________
9. (two words) a) a tax incentive which allows certain taxpayers to subtract the amount of the credit from the amount of tax owed;
b) prepaid income tax that can be offset against the total income tax payable
___________
10. Something that encourages a person or organization to do something
___________
Exercise 3. Match the words to the prepositions:
| 1.responsible | A.to |
| 2.specialised | B.of |
| 3.deal | C.for |
| 4.in charge | D.on |
| 5.entitled | E.from |
| 6.comply | F.from |
| 7.related | G.in |
| 8.advise | H.with |
| 9.exempt | I.with |
| 10.subtracted | J.to |
GRAMMAR FOCUS:
Exercise 4. Present Simple Tense.
Use the prompts below to interview your partner about functions that he or she generally performs in his or her job.
§ monitor tax legislation
§ ensure compliance with taxation authority requirements
§ involved in resolving legal disputes
§ fill in tax returns
§ advise management on tax impact of corporate strategies
§ keep clients informed on tax changes that affect their business
Report the information to the class.
Example: I regularly monitor tax legislation, while my partner doesn’t monitor tax legislation.
Exercise 5. Text completion.
Read the text and complete it with the following words.
fees subject tax codes
sole proprietors deductions t ax deductible
incurs tax benefits
Tax Deductible Expenses
· Business related travel expense
· Legal and accounting fees
· Advertising fees
· Rent of business premises
· Utilities
· Employee education
· Subscriptions to professional publications
· Professional membership fees
· License fees
Every business organization, either large or small, _________ (1)some expenses in course of their work. Those expenses may be related to business trips, payment of advertising costs, new software, legal fees, rents, utilities, etc. Being able to deduct expenses from total income is important for both incorporated businesses and _____________ (2), as it reduces the amount of tax owed.
___________ (3) expensesare those expenses that can be subtracted from taxable income to reduce the amount of income that is ________ (4) totaxation. To be entitled to claim ___________ (5), a company or individual must make sure that those expenses are directly related to earning of income and have a legitimate business purpose. Deductions may cover the entire amount of the expense incurred or a certain percentage of it.
Generally, a business expense is recognized as _______ (6) deductible if it meets two criteria: it must be both ordinary and necessary for the business. However, this definition is rather vague and ________ (7)indifferent countries allow different types of expenses to be deducted from taxable income.
The business expense items that are typically tax deductible include business-related travel expense, client entertainment, employee ________ (8), rent of business premises, utilities, legal and accounting fees, advertising fees, bank charges, employee education and training, insurance costs, subscriptionsto professional publications, professional membership _______ (9), licence fees, etc.
In addition to claiming business expense, tax deductions сan sometimes be obtained by making charitable donations or participating in socially-beneficial programmes, such as those promoting environmentally-friendly practices, for instance. In such cases, the government authorities use tax deductions to promote specific behaviour and encourage taxpayers to take part in a particular activity.
Exercise 6. Match the words to their meaning:
| 1.Tax Credit | A.an expense that can be subtracted from gross income to reduce the amount of income subject to tax |
| 2.Taxable Income | B.any programme or incentive that reduces the amount of tax owed by an individual or business entity |
| 3.Personal Allowance | C.the total amount of tax that an entity or individual is legally obligated to pay |
| 4.Tax Refund | D.the amount of income that is used to calculate an individual’s or an entity’s income tax due |
| 5.Tax Liability | E.free from obligation to pay a tax |
| 6.Impose Tax | F.to introduce a tax and make it compulsory |
| 7.Tax Deductible Expense | G.an income that is subject to taxation after all deductions |
| 8.Tax Base | H.an amount of money that a taxpayer is able to subtract from the amount of tax owed |
| 9.Exempt from Tax | I.a return of excess amounts of tax, when the tax liability is less than the taxes paid |
| 10.Tax Relief | J.tax-free amount subtracted from an income |
SPEAKING FOCUS
1. As a potential investor, you are interested in various aspects of your partner’s country taxation system. Find out about the following issues:
§ current corporate income tax rate
§ tax allowances
§ tax exemptions
§ tax credits
§ tax incentives
What type of business expense is recognized as tax deductible in your country?
VOCABULARY FOCUS
after-tax income чистая прибыль
allocation размещение
allowances налоговые скидки
alter (v) изменять, менять, переделывать
assurance гарантия
be aimed at нацеливаться на
by-product побочный продукт
consumption patterns нормы потребления
curtail (v) сокращать, укорачивать
customs duty таможенная пошлина
deductible expenses необлагаемые налогом расходы
deprived малоимущий, неимущий
entail (v) повлечь за собой
economic set-up экономическая структура
economic constraint экономическое ограничение
exaggeration преувеличение
exemption освобождение от налогов; сумма, вычи-
таемая из налогооблагаемой базы
excessive tax rate непомерная налоговая ставка
extra-budgetary fund внебюджетный фонд
facet грань
fiscality фискальная политика
fractional reserve частичный резерв
government decree распоряжение правительства
holistic глобальный, единый
incentive стимул
income redistribution перераспределение доходов
incorporated business фирма, зарегистрированная как корпорация; акционерная компания
imposition обложение, наложение, налог
inhibit (v) задерживать, подавлять, тормозить, пре-
пятствовать
insurmountable difficulties непреодолимые трудности
internal feature внутренние свойства
irreversible необратимый
legislation законодательство
levy taxes взимать налоги, облагать
mandatory payments обязательные платежи
manifestation обнародование, проявление
negligible cost незначительные, мелкие издержки
offset возмещение, компенсация
provide for (v) обеспечивать, предоставлять
prohibitive duty запретительная пошлина; чрезмерно
высокая
repercussions отдаленные последствия
replicate (v) воспроизводить, повторять
resource reallocation перераспределение ресурсов
sole proprietor индивидуальный предприниматель
stipulated оговоренный, обусловленный
suppression подавление, скрытие
social income общественный доход
subject to taxation подлежащий налогообложению
taxable income доход, подлежащий налогообложению
tax base налогооблагаемая база
tax credit налоговая льгота (субсидия)
tax deductions налоговые вычеты
tax exemptions освобождение от уплаты налогов
tax-free не облагаемый налогами
tax liability налоговое обязательство
tax rate ставка налогообложения
tax refund возврат суммы излишне уплаченного налога
taxpayer налогоплательщик
tax yield налоговый доход
ultimately в конечном счете, в итоге
utility function функция полезности
utility measure критерий полезности
work effort интенсивность труда
PART 3
TOPIC FOCUS: How the GOP* Tax Bill Affects You
