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Inland Revenue

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Inland Revenue
Corporate Logo of Inland Revenue.svg
Final logo
Non-ministerial government department overview
Formed1849 (1849)
Preceding agencies
Dissolved18 April 2005 (2005-04-18)
Superseding agency
JurisdictionUnited Kingdom
HeadquartersSomerset House
London, WC2
This article is about the United Kingdom government department. For other countries, see Inland Revenue Department.

The Inland Revenue was, until April 2005, a department of the British Government responsible for the collection of direct taxation, including income tax, national insurance contributions, capital gains tax, inheritance tax, corporation tax, petroleum revenue tax and stamp duty. More recently, the Inland Revenue also administered the Tax Credits schemes,[1] whereby monies, such as Working Tax Credit (WTC) and Child Tax Credit (CTC), are paid by the Government into a recipient's bank account or as part of their wages. The Inland Revenue was also responsible for the payment of child benefit.

The Inland Revenue was merged with HM Customs and Excise to form HM Revenue and Customs which came into existence on 18 April 2005.[2] The former Inland Revenue thus became part of HM Revenue and Customs. The current name was promoted by the use of the expression "from Revenue and Customs" in a series of annual radio, and to a lesser extent, television public information broadcasts in the 2000s and 2010s.

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Direct tax

Direct tax

Although the actual definitions vary between jurisdictions, in general, a direct tax or income tax is a tax imposed upon a person or property as distinct from a tax imposed upon a transaction, which is described as an indirect tax. There is a distinction between direct and indirect tax depending on whether the tax payer is the actual taxpayer or if the amount of tax is supported by a third party, usually a client. The term may be used in economic and political analyses, but does not itself have any legal implications. However, in the United States, the term has special constitutional significance because of a provision in the U.S. Constitution that any direct taxes imposed by the national government be apportioned among the states on the basis of population. In the European Union direct taxation remains the sole responsibility of member states.

Income tax

Income tax

An income tax is a tax imposed on individuals or entities (taxpayers) in respect of the income or profits earned by them. Income tax generally is computed as the product of a tax rate times the taxable income. Taxation rates may vary by type or characteristics of the taxpayer and the type of income.

Capital gains tax

Capital gains tax

A capital gains tax (CGT) is the tax on profits realized on the sale of a non-inventory asset. The most common capital gains are realized from the sale of stocks, bonds, precious metals, real estate, and property.

United Kingdom corporation tax

United Kingdom corporation tax

Corporation tax in the United Kingdom is a corporate tax levied in on the profits made by UK-resident companies and on the profits of entities registered overseas with permanent establishments in the UK.

Stamp duty

Stamp duty

Stamp duty is a tax that is levied on single property purchases or documents. A physical revenue stamp had to be attached to or impressed upon the document to show that stamp duty had been paid before the document was legally effective. More modern versions of the tax no longer require an actual stamp.

Child tax credit

Child tax credit

A child tax credit (CTC) is a tax credit for parents with dependent children given by various countries. The credit is often linked to the number of dependent children a taxpayer has and sometimes the taxpayer's income level. For example, in the United States, only families making less than $400,000 per year may claim the full CTC. Similarly, in the United Kingdom, the tax credit is only available for families making less than £42,000 per year.

Child benefit

Child benefit

Child benefit or children's allowance is a social security payment which is distributed to the parents or guardians of children, teenagers and in some cases, young adults. A number of countries operate different versions of the program. In most countries, child benefit is means-tested and the amount of child benefit paid is usually dependent on the number of children one has.

HM Customs and Excise

HM Customs and Excise

HM Customs and Excise was a department of the British Government formed in 1909 by the merger of HM Customs and HM Excise; its primary responsibility was the collection of customs duties, excise duties, and other indirect taxes.

HM Revenue and Customs

HM Revenue and Customs

HM Revenue and Customs is a non-ministerial department of the UK Government responsible for the collection of taxes, the payment of some forms of state support, the administration of other regulatory regimes including the national minimum wage and the issuance of national insurance numbers. HMRC was formed by the merger of the Inland Revenue and HM Customs and Excise, which took effect on 18 April 2005. The department's logo is the St Edward's Crown enclosed within a circle. Prior to the Queen's death on 8 September 2022, the department was known as Her Majesty's Revenue and Customs and has since been amended to reflect the change of monarch.

History

See also: History of taxation in the United Kingdom

The Board of Taxes

The beginnings of the Inland Revenue date from 1665, when a Board of Taxes was set up following the introduction of special taxes to pay for the Second Anglo-Dutch War. A central organisation to supervise the collection of the special taxes was required; it became known as the Tax Office.[3]

Taxes administered by the Board of Taxes included the Land Tax, first levied in 1692, along with the window tax and house tax, both of which dated from 1696. In 1785 a number of other miscellaneous taxes, administered by the Stamp Office and the Excise Office, were transferred to the Tax Office; these included taxes on carriages (dating from 1747), on wagons and carts, on male servants (1777) and on horses (1784).[4] Together with the House Tax and the Window Tax, they came to be known as the 'assessed taxes' and were intended as a progressive form of taxation on the wealthy.[5]

Income tax was introduced in various forms in 1797, 1799, 1803 to 1816, and then reintroduced in 1842 as an annual tax which is formally renewed in each year's Finance Act.

The Board of Stamps

A separate Board of Stamps was created by the Stamps Act 1694. During the 18th and early 19th centuries at various times (as financial strains on the economy demanded, and Parliament allowed) stamp duties were extended above a certain threshold of sale value to cover newspapers, pamphlets, lottery tickets, apprentices' indentures, advertisements, playing cards, dice, hats, gloves, patent medicines, perfumes, insurance policies, gold and silver plate and armorial bearings (coats of arms). One further category is the most widely cited example of an unpopular and most difficult to enforce tax, the Duty on Hair Powder Act 1795. The last stamp taxes to remain are stamp duty land tax and stamp duty reserve tax; however the use of physical stamps has ceased.

The Board of Stamps and Taxes

In June 1833, following a steady reduction in the number of different taxes and duties being levied, a single body of Commissioners was set up to merge the revenues of stamps and taxes. The Board of Taxes and the Board of Stamps were formally combined under the Land Tax Act 1834 to form the Board of Stamps and Taxes.

The Board of Inland Revenue

LOOT and EXTORTION Dedicated To H.M. Inland Revenue,statues at Trago Mills (near Liskeard, Cornwall), poking fun at the Inland Revenue.
LOOT and EXTORTION Dedicated To H.M. Inland Revenue,
statues at Trago Mills (near Liskeard, Cornwall), poking fun at the Inland Revenue.

The Board of Inland Revenue was created under the Inland Revenue Board Act 1849, after the Board of Excise and the Board of Stamps and Taxes were amalgamated. Responsibility for excise duties was transferred to the Board of Customs and Excise in 1909.

In 1995 to help promote self-assessment tax returns, Inland Revenue created the character of Hector the Tax Inspector to help in their advertising campaign.

HM Revenue and Customs

The 2004 Budget included proposals to merge HM Customs and Excise with the Board of Inland Revenue to form a new department, HM Revenue and Customs (HMRC). The merger was implemented by the Commissioners for Revenue and Customs Act 2005 with effect from 18 April 2005.

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History of taxation in the United Kingdom

History of taxation in the United Kingdom

The history of taxation in the United Kingdom includes the history of all collections by governments under law, in money or in kind, including collections by monarchs and lesser feudal lords, levied on persons or property subject to the government, with the primary purpose of raising revenue.

Second Anglo-Dutch War

Second Anglo-Dutch War

The Second Anglo-Dutch War or the Second Dutch War was a conflict between England and the Dutch Republic partly for control over the seas and trade routes. England tried to end the Dutch domination of world trade during a period of intense European commercial rivalry, but also as a result of political tensions. After initial English successes, the war ended in a Dutch victory. It was the second of a series of naval wars fought between the English and the Dutch in the 17th and 18th centuries.

Land Tax (England)

Land Tax (England)

The Land Tax was a land value tax levied in England from 1692 to 1963, though such taxes predate the best-known 1692 Act. Taxes on land date back to the Norman Conquest and beyond, and the Land Tax introduced in 1692 was a natural successor to taxation acts in 1671 and 1689, but the 1692 act "has been regarded as a turning point in the history of English revenue collection. It was from this Act that contemporaries and historians alike date what has come to be known as the eighteenth-century Land Tax". The land tax elements of the 1671, 1689 and 1692 Acts were limited to one year but the 1798 Act made the tax perpetual.

Hearth tax

Hearth tax

A hearth tax was a property tax in certain countries during the medieval and early modern period, levied on each hearth, thus by proxy on wealth. It was calculated based on the number of hearths, or fireplaces, within a municipal area and is considered among the first types of progressive tax.

Progressive tax

Progressive tax

A progressive tax is a tax in which the tax rate increases as the taxable amount increases. The term progressive refers to the way the tax rate progresses from low to high, with the result that a taxpayer's average tax rate is less than the person's marginal tax rate. The term can be applied to individual taxes or to a tax system as a whole. Progressive taxes are imposed in an attempt to reduce the tax incidence of people with a lower ability to pay, as such taxes shift the incidence increasingly to those with a higher ability-to-pay. The opposite of a progressive tax is a regressive tax, such as a sales tax, where the poor pay a larger proportion of their income compared to the rich.

Finance Act

Finance Act

A Finance Act is the headline fiscal (budgetary) legislation enacted by the UK Parliament, containing multiple provisions as to taxes, duties, exemptions and reliefs at least once per year, and in particular setting out the principal tax rates for each fiscal year.

Pamphlet

Pamphlet

A pamphlet is an unbound book. Pamphlets may consist of a single sheet of paper that is printed on both sides and folded in half, in thirds, or in fourths, called a leaflet or it may consist of a few pages that are folded in half and saddle stapled at the crease to make a simple book.

Indenture

Indenture

An indenture is a legal contract that reflects or covers a debt or purchase obligation. It specifically refers to two types of practices: in historical usage, an indentured servant status, and in modern usage, it is an instrument used for commercial debt or real estate transaction.

Patent medicine

Patent medicine

A patent medicine, sometimes called a proprietary medicine, is an over-the-counter (nonprescription) medicine or medicinal preparation that is typically protected and advertised by a trademark and trade name and claimed to be effective against minor disorders and symptoms. Its contents are typically incompletely disclosed. Antiseptics, analgesics, some sedatives, laxatives, and antacids, cold and cough medicines, and various skin preparations are included in the group. The safety and effectiveness of patent medicines and their sale is controlled and regulated by the Food and Drug Administration in the United States and corresponding authorities in other countries.

Plating

Plating

Plating is a surface covering in which a metal is deposited on a conductive surface. Plating has been done for hundreds of years; it is also critical for modern technology. Plating is used to decorate objects, for corrosion inhibition, to improve solderability, to harden, to improve wearability, to reduce friction, to improve paint adhesion, to alter conductivity, to improve IR reflectivity, for radiation shielding, and for other purposes. Jewelry typically uses plating to give a silver or gold finish.

Coat of arms

Coat of arms

A coat of arms is a heraldic visual design on an escutcheon, surcoat, or tabard. The coat of arms on an escutcheon forms the central element of the full heraldic achievement, which in its whole consists of a shield, supporters, a crest, and a motto. A coat of arms is traditionally unique to the armiger. The term itself of 'coat of arms' describing in modern times just the heraldic design, originates from the description of the entire medieval chainmail 'surcoat' garment used in combat or preparation for the latter.

Duty on Hair Powder Act 1795

Duty on Hair Powder Act 1795

The Duty on Hair Powder Act 1795 was an Act of the Parliament of Great Britain which levied a tax on hair powder. The tax was used to finance government programs, especially to fund the Revolutionary and Napoleonic Wars with France. The Act was repealed in 1869.

List of taxes

See also: Stamp duty in the United Kingdom § List of items subject to Stamp Duty

The following taxes were administered at various times either by the Inland Revenue or by its predecessors (excise duties are not included):[6][7]

  • Land Tax (1692-1963)
  • Stamp Duty (1694 onwards)
  • Window tax (1696-1851)[8]
  • Inhabited House Duty (1778-1834, 1851-1924)
  • Legacy Duty (1780-1949)
  • Assessed taxes (1785):
    • Coaches and carriages tax (1746-1798) (administered by the Excise Office until 1785)
    • Male servants tax (1777-1852) (administered by the Excise Office until 1785)
    • Waggons, wains and carts tax (1783-1792) (administered by the Stamp Office until 1785)
    • Saddle and Carriage Horse tax (1784-1875) (administered by the Stamp Office until 1785; converted to excise licence duty in 1869)
    • Racehorse tax (1784-1875) (administered by the Excise Office until 1785; converted to excise duty in 1856)
    • Game tax (1784-2007) (Stamp duty until 1808; converted to excise licence in 1860)
    • Female servants tax (1785-1792)
    • Shop tax (1785-1789)
    • Hair Powder tax (1795-1869) (classed as licence duty until 1802) (there was also a Stamp Duty levied on hair powder from 1786-1800)[9]
    • Dog tax (1796-1988) (converted to excise licence duty in 1867)
    • Clocks and watches tax (1797-1798)
    • Armorial Bearings tax (1798-1944) (converted to excise licence duty in 1869)
  • Income Tax (1799-1802, 1803-1816, 1842 onwards)
  • Succession Duty (1853-1949)
  • Corporation Duty (1885-1959)
  • Estate Duty (1894-1974)
  • Super Tax (1909-1973)
  • Excess Profits Duty (1915-1921)
  • Profits Tax (1937-1966)
  • Excess Profits Tax (1939-1946)
  • Capital Gains Tax (1965 onwards)
  • Corporation tax (1966 onwards)
  • Capital Transfer Tax (later called Inheritance Tax) (1974 onwards)
  • Petroleum Revenue Tax (1975 onwards)

The Inland Revenue also received National Insurance contributions and administered child benefit payments and Tax Credits.

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Window tax

Window tax

Window tax was a property tax based on the number of windows in a house. It was a significant social, cultural, and architectural force in England, France, and Ireland during the 18th and 19th centuries. To avoid the tax, some houses from the period can be seen to have bricked-up window-spaces. In England and Wales it was introduced in 1696 and was repealed 155 years later, in 1851. In France it was established in 1798 and was repealed in 1926. Scotland had window tax from 1748 until 1798.

Game (hunting)

Game (hunting)

Game or quarry is any wild animal hunted for animal products, for recreation ("sporting"), or for trophies. The species of animals hunted as game varies in different parts of the world and by different local jurisdictions, though most are terrestrial mammals and birds. Fish caught non-commercially are also referred to as game fish.

History of inheritance taxes in the United Kingdom

History of inheritance taxes in the United Kingdom

The history of inheritance taxes in the United Kingdom has undergone significant change and mutation since their original introduction in 1694.

Surtax

Surtax

A surtax is a tax levied upon another tax, also known as tax surcharge.

Excess profits tax

Excess profits tax

In the United States, an excess profits tax is a tax on any profit above a certain amount. A predominantly wartime fiscal instrument, the tax was designed primarily to capture wartime profits that exceeded normal peacetime profits to prevent perverse incentives for manufacturers to engage in war profiteering and warmongering.

United Kingdom corporation tax

United Kingdom corporation tax

Corporation tax in the United Kingdom is a corporate tax levied in on the profits made by UK-resident companies and on the profits of entities registered overseas with permanent establishments in the UK.

Petroleum Revenue Tax

Petroleum Revenue Tax

Petroleum Revenue Tax (PRT) is a direct tax collected in the United Kingdom. It was introduced under the Oil Taxation Act 1975, soon after Harold Wilson's Labour government returned to power and in the immediate aftermath of the 1973 energy crisis, and was intended to ensure "fairer share of profits for the nation" from the exploitation of the UK's continental shelf, while ensuring a "suitable return" on the capital investment by oil companies.

National Insurance

National Insurance

National Insurance (NI) is a fundamental component of the welfare state in the United Kingdom. It acts as a form of social security, since payment of NI contributions establishes entitlement to certain state benefits for workers and their families.

Child benefits in the United Kingdom

Child benefits in the United Kingdom

Child benefits in the United Kingdom are a series of welfare payments and tax credits made to parents with children in the UK, a major part of the welfare state.

Notable staff

Ministerial leadership

Main articles: Minister of Inland Revenue, HM Treasury, and Treasury Select Committee

The leadership and taking of the highest level of decisions is ministerial as the concept of any particular tax and the degree of success in collecting any particular tax rests ultimately with the political decisions taken. Of particular relevance are the debates in Parliament in their imposition.

Civil servants

The Permanent Secretary to the Treasury has the main advisory, policy informative role to play in the enabling of the department's functions, in liaison with Board Chairman who bore overall responsibility along with the rest of the Board for the operational carrying out of the Inland Revenue's functions.

As sub-departments (typically, Offices, Boards and Bureaus) have issued their own taxes or expanded their remit, they too have seen Comptrollers General and Chairmen. An example was Robert Wilkie Stanton, Comptroller of Stamps and Taxes (Scotland), Board of Inland Revenue.

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Minister of Inland Revenue

Minister of Inland Revenue

The Minister of Inland Revenue is the political office of Minister for the department of Inland Revenue which is responsible for the collection of taxes. "Minister of Inland Revenue" is a title held by politicians in different countries. As of 2017 the office remains in use in New Zealand, held by Stuart Nash; no historical information about the New Zealand office is provided on the government web site.

HM Treasury

HM Treasury

His Majesty's Treasury, occasionally referred to as the Exchequer, or more informally the Treasury, is a department of His Majesty's Government responsible for developing and executing the government's public finance policy and economic policy. The Treasury maintains the Online System for Central Accounting and Reporting (OSCAR), the replacement for the Combined Online Information System (COINS), which itemises departmental spending under thousands of category headings, and from which the Whole of Government Accounts (WGA) annual financial statements are produced.

Treasury Select Committee

Treasury Select Committee

The House of Commons Treasury Committee is a select committee of the House of Commons in the Parliament of the United Kingdom. The remit of the committee is to examine the expenditure, administration and policy of HM Treasury, with all of its agencies and associated bodies, including HM Revenue and Customs, the Bank of England, the Prudential Regulation Authority, the Financial Conduct Authority, the Royal Mint, and so on.

STEPS contract

In 2001 the Inland Revenue entered into a Private Finance Initiative contract whereby it sold two-thirds of its estate to Mapeley for £370 million and then leased the properties back.[10]

Source: "Inland Revenue", Wikipedia, Wikimedia Foundation, (2023, March 28th), https://en.wikipedia.org/wiki/Inland_Revenue.

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Further Reading

HM Customs and Excise

HM Revenue and Customs

Taxation in the United Kingdom

Finance Act

Stamp duty in the United Kingdom

List of Acts of the Parliament of Great Britain, 1780–1789

Taxation in Australia

HM Customs

Motoring taxation in the United Kingdom

HM Excise

Excise

Inland Revenue Authority of Singapore

Royal Malaysian Customs Department

History of taxation in the United Kingdom

Revenue stamps of the United Kingdom
See also
References
  1. ^ "Childcare vouchers: better off calculator". hmrc.gov.uk.
  2. ^ "HM Revenue and Customs: About Us". hmrc.gov.uk. Retrieved 11 February 2013.
  3. ^ Ward, W.R. (1952). "The Office of Taxes, 1665-1798". Bulletin of the Institute of Historical Research. 25 (72): 204.
  4. ^ Jeffrey-Cook, John. "Taxing horses, dogs, guinea-pigs and seals". taxation.co.uk. Retrieved 3 April 2018.
  5. ^ "Assessed Tax Rolls, 1799 - 1831". Aberdeen City Council. Retrieved 2 April 2018.
  6. ^ "Records of the Boards of Stamps, Taxes, Excise, Stamps and Taxes, and Inland Revenue". National Archives. Retrieved 22 March 2018.
  7. ^ Jeffrey-Cook, John (2010). "William Pitt and his Taxes" (PDF). British Tax Review (4). Retrieved 21 March 2023.
  8. ^ Full text of the 1696 Act
  9. ^ Jeffrey-Cook, John (2010). "William Pitt and his Taxes" (PDF). British Tax Review (4).
  10. ^ "HMRC's STEPS contract". UK Parliament. Retrieved 6 May 2018.
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