What does HMRC stand for?

HMRC stands for His Majesty’s Revenue and Customs, although it was previously known as Her Majesty’s Revenue and Customs. It is the tax authority in the United Kingdom.

How does HMRC work?

HMRC is responsible for enforcing tax laws and regulations in the UK. It administers the collection of taxes from both businesses and individuals. Employers, for instance, are required to pay income tax and national insurance contributions to HMRC regularly. The department collaborates with other government authorities to ensure tax compliance and has the authority to investigate violations and impose penalties for non-compliance.

What are the types of taxes paid to HMRC?

There are various types of taxes paid to HMRC, depending on the nature of income or activities being taxed.

These taxes include:

• Corporation Tax: A tax on profits earned by companies and corporations operating in the UK, calculated and paid annually.
• Value Added Tax (VAT): A tax added to goods and services at each stage of production in the UK, including exports and imports.
• Income Tax: Pertains to individuals' income, covering employment, self-employment, and investment income.
• National Insurance Contributions: Contributions made to the UK's social security system, which fund programs such as state pensions, paternity and maternity pay, and sick pay.
• Capital Gains Tax: A tax on profits generated from the sale of specific assets like businesses, shares, and property.
• Inheritance Tax: Paid on the estate of a deceased person, calculated based on the value of their assets at the time of death.

Are businesses required to pay taxes on behalf of their employees to HMRC?

While businesses are not legally required to pay taxes on behalf of their employees, they are responsible for deducting income tax and national insurance contributions from their employees' wages and remitting these deductions to HMRC. For additional information or specific inquiries related to HMRC and tax matters, please refer to HMRC's official website or consult with a tax professional.