'VĐHCL
420
8103GI
2022
Œ.1
26176

IIIIIIIIIIIll
BỘ GIÁO DỤC VÀ ĐÀO TẠO

TRƯỜNG ĐẠI HỌC CỬU LONG
BRD

KHOA NGOAI NGU

BAI GIANG

TIENG ANH
HỢP DONG THUONG MAI

Giảng viên:

ThS. Trần Ngọc Trí

Vĩnh Long - 2022


Contents
UNIT 1: PRIVATE

LAW — CONTRACTT..........................---5:-55c 25tr

WINTHG2 3 CONTRA COLA Worcs
UNIT3:

FORMING.A

UNIT 4: STRUCTURE

oc Petites cesses slecesccstl-ontetcnectasseovsanssssostsiorteeertcotnentbets 6

CONTRAGT,..:--ss
2
hà 2y2a85aa 8
OF A COMMERCIAL

UNITS5: CORPORATION:TAX-.......UNTT 6: DEBT

FINANCING:

UNIT 7: BUYING AND

S2 cối

CONTRACT.............................. 12

22212

SECURED

2n


0n t g2 naeiaee 20

LENDING..........................................-.... 24

SELLUING COMMERCIAL

UNIT §: INTERNATIONAL
IRGICTEHCGS.-

1

PROPERTY. .................... 28

DISPUTE RESOLUTION........................................- 32
2 b2 n 2091

5. moi, hg n0 S9 E D020 L3

2 ƯA vui Tuờy 38


UNIT 1: PRIVATE LAW —- CONTRACT

Before you read

1. Did you list include any of these words, which appear in this text? Try to

match each word to the correct definition.


b. money given as legal compensation

c. to reject, or not accept an appeal
d. a person who brings [i.e. starts] an action in civil law
e. to have a right to something
f. to decide in legal proceedings

g. a person who depends a civil or criminal action
h. to take legal action against someone in a case
i. to give a judicial decision

NAAR
wD

1. plaintiff

Cer

a. the first hearing of a case, not an appeal

defendant

to hold
to be entitled
to dismiss an appeal
to sue

case of first instance
to deliver judgment
damages


2. Abbreviations

a) Look at the title of the case. Do you understand the abbreviations: v. and
Co.?

b) [1893] 1 Q.B.256 is the reference number of this case in the law reports: is
it reported in volume 1 of the Q.B law reports for the year 1893 at page 256. Q.B.
refers to the series of law reports ( the Queen’s Bench law reports) in which the case

was reported, NOT the court in which it was heard. It was heard in the Court of
Appeal.
c) What information does the title of the case give you without looking at the
case?
First reading: understanding the contents and organization of the text
1. The first part of the case, which is reproduced on the reading passage below,
contains five main elements:

i). legal principles decided in the case
ii). the facts of the case

iii).decision in the case of first instance
1


iv).first judge’s decision in the appeal

v). second judge’s decision and judgment in the appeal: arguments for the
defendant.


Skim the text and divide it clearly into these five sections, so that you can see
exactly

how

the

material

is organized.

Do

not try to read

the text in detail

or

understand everything you read for this activity.
2. Scan the text to find four other abbreviations: what do they mean?
Carlill v. Carbolic Smoke Ball Co.
[1893] 1 Q.B.256

An offer, to be capable of acceptance, must involve a definite promise by the
offeror that he will bind himself if the exact terms specified by him are accepted.
An offer may be made either to a particular person or to the public at large.
If an offer takes the form of a promise in return for an act, the performance
of that act is in itself an adequate indication of assent.
APPEAL


from

a decision

proprietors and vendors of
Ball,”

inserted

in the Pall

of Hawkins,

J. The

defendants,

who

were

a medical preparation called “The Carbolic
Mall

Gazette

of November

13,


1891,

and

the

Smoke
in other

newspapers, the following advertisement:
“100/. reward will be paid by the Carbolic Smoke Ball Company to any person who
contracts in increasing epidemic influenza, colds, or any disease caused by taking
cold, after having used the ball three times daily for two weeks according to the
printed directions supplied with each ball.

1000/.

is deposited with the Alliance

Bank, Regent Street, shewing our sincerity in the matter. During the last epidemic
of influenza many thousand carbolic smoke balls were sold as preventives against
this disease, and in no ascertained case was the disease contracted by those using
the carbolic smoke ball. One carbolic smoke ball will last a family several months,
making it the cheapest remedy in the world at the price, 10s. post free. The ball can

be refilled at a cost of 5s. Address, Carbolic Smoke Ball Company, 27, Princes
Street, Hanover Square, London.”

The plaintiff, a lady, on the faith of this advertisement, bought one of the


balls at a chemist’s, and used it as directed, three times a day, from November 20,
1891, to January
HAWKINS,

17, 1892, when she was attacked by influenza.
J., held that she was entitled to recover the 100/

appealed.

LINDLEY, L.J., delivered judgment

dismissing the appeal.
2

The

defendants


BOWEN, L.J. I am of the same opinion. We were asked to say that this document
was a contract too vague to be enforced.
The first observation which arises is that the document itself is not a contract
at all, is it only an offer made to the public. The defendants contend next, that it is

an offer the terms of which are too vague to be treated as a definite offer, inasmuch

as there is no limit of time fixed for the catching of the influenza, and it cannot be
supposed that the advertisers seriously meant to promise to pay money to every
person who catches the influenza at any time after the inhaling of the smoke ball. It

was urged also, that if you look at this document you will find much vagueness as to

the persons with whom

the contract was intended to be made — that, in the first

place, its terms are wide enough to include persons who made have used the smoke
ball before the advertisement was issued; at all events, that it is an offer to the world
in the general, and, also, that it is unreasonable to suppose it to be a definite offer,

because nobody in their senses would contract themselves out of the opportunity of
checking the experiment which was going to be made at their own expense. It is
also contended that the advertisement is rather in the nature of a puff or a
proclamation than a promise or offer intended to mature into a contract when
accepted. But the main point seems to be that the vagueness of the document shews
that no contract whatever was intended.
Reading for detail and language study: the facts of the case

1. Scan the text to find the following facts:
a) Who was the plaintiff in the case of first instance?
b) Who were the defendants?
c)
d)
2.

Who won the case of first instance?
Who appealed against that decision?

Vocabulary: using context clues (1)


It is often possible to use the context to understand the meaning of new words in
a text.

Sometimes

the general

context will help you

understand

a word,

and

sometimes specific words or phrases in the text will indicate its meaning. Words or
phrases that help you understand unknown words in this way are called ‘context
clues’.


In the exercise below, try to work out the probable meaning of the words in
CAPITALS

by using the context clues in italics. In Section Two of this Unit you

will have to find the context clues yourself.
Example:

1001. REWARD will be paid ... to any person who contacts influenza ....
REWARD


= money you offer to someone who does a certain thing.

REWARD

= money offered for a certain action

a)

the increasing epidemic influenza, colds of any DISEASE

caused by taking

cold...
DISEASE = a general term (‘any’) which includes colds and ’flu. DISEASE =

b) /0001. is DEPOSITED with the Alliance Bank
DEPOSITED =
c)

many

thousand

smoke

balls

were


sold

as PREVENTIVES

against

this

disease and in no case was the disease contracted...

PREVENTIVES =
d) Hawkins J. held that she [the plaintiff] was entitled to RECOVER

The defendants appealed.
e) RECOVER =
3.

Reading the text carefully and answers the following questions:
a) What did Carbolic Smoke Ball Co. sell?

b) What were they for?
c) According the company, did they work?
d) Were they expensive?
e)

Who did the Company offer to pay 700. to?

f)

Why did they deposit /000/. with the bank?


g) Why did the plaintiff buy the product?
h) Did she follow the instructions?
i)

Did it work in her case?

j)

Why do you suppose the company made this offer?

the 1001.


k) In your opinion, does it look like a serious offer? Give reasons for your

answer.
4. Which summary of the facts given below corresponds exactly to the text? As

a preventive against flu the plaintiff bought a carbolic smoke ball from the
defendant company

because she had read their advertisement.

She use it

according to the instructions.

a. She later sued the company for damages because she caught flu.


b. She later sued the company

for the 100/. reward they had advertised

because she caught flu.
c. She later sued the company

because she caught flu, and then appealed

against the decision of the court of first instance.
5.

Was the advertisement a contract?


UNIT 2: CONTRACT

LAW

Contract law deals with promises which create legal rights. In most legal
sytems, a contract is formed when one party makes an offer that is accepted by the
other party. Some legal systems require more, for example that the parties give each
other, or promise to give each other, something of value. In common law systems,

this promise is known as consideration. In those systems, one-side promise to do
something

(e.g. a promise to make a

gift) does not lead to the formation


of an

enforceable contract, as it lacks consideration.

When the contract is negotiated, the offer and acceptance must match each
other in order for the contract to be binding. This means that one party must accept
exactly what the other party has offered. If the offer and acceptance do not match

each other, then the law says that the second party has made a counter-offer (that is,
a new offer to the first party which may be accepted or rejected). For there to be
valid contract, the parties must agree on the essential terms. These include the price
and the subject matter of the contract.
Contract may be made in writing or by spoken words. If the parties make a

contract by spoken words, it is called an oral contract. In some jurisdictions, certain
special types of contract must be in writing or they are not valid (e.g. the sale of
land).

give both parties rights and obligations. Rights are something
positive which a party wants to get from a contract (e.g. the right to payment of
Contracts

money). Obligations are something which a party has to do or give up to get those

rights (e.g. the obligation to do work).
When the party does not do what it is required to do under a contract, that

party is said to have breached the contract. The other party may file a lawsuit
against the breaching party for breach of contract. The non-breaching party


(sometimes called the injured party) may try to get a court to award damages for the

breach. Damages refers to money which the court orders the breaching party to pay

for the non-breaching party in compensation. Other remedies include specific
performance, where a court orders the breaching party to perform the contract (that
is, to do what it promised to do).

A party may want to transfer its rights under a contract to another party. This
is called an assignment. When a party assigns (gives) its rights under the contract to
another party, the assigning party is called the assignor and the party who gets the

rights is called the assignee.


A. Read the text above and decide whether these statements are True (T) or
False (F)

1. Both parties given under the contract are rights and obligations.
2. A party that breaches the terms of the contract is called an injured party.
3.

It is legal for a party to transfer its rights under a contract to another.

4.

Something positive a party wants to get from the contract is called rights.

B. Read the text again and answer the following questions:


1. Who is an assignee?
2 . What does contract deal with?
3.

What is necessary for a valid contract to be formed?

4.

When is a contract formed?


UNIT 3: FORMING A CONTRACT
Before you read: talk about these questions

1. What type of information does a contract usually contain?
2. Why would you work with an attorney when writing/ drafting a contract?
Read the text below
A. Basic principles

The basic principles of contract law in the English system arise from established
custom and rules and are fundamental to all areas of law in practice. Reference is

made to these principles in drafting and interpreting the provisions of any legal
agreement, such as a lease, a loan agreement, a sales agreement, a consultancy
agreement,

a hire purchase agreement,

a hire contract, or a service contract,


etc. The principles of contract law will determine whether and at what point a
binding agreement has been made between the parties concerned.

Note: The words contract and agreement are interchangeable in the examples
above. For example, a loan agreement/loan contract.
B. Formation of a contract
Formation of a contract requires the presence of four essential elements:
=

Offer

The contract must contain the basis terms of the agreement and be capable of
acceptance

without

further negotiation.

This

does not mean

that the initial

communication between parties will in itself constitute an offer. For example, in
an auction situation, the seller, known as the vendor, may make an invitation to
treat - invite an offer - by setting out the conditions of sale (for example when

payment will be made) with the exception of the price. The offer is submitted by

the purchaser,

who

offers to purchase

at a specified

price

and

will

usually

incorporate the terms of the invitation to treat into his/her offer.
=

Acceptance
There must be an unqualified agreement to proceed on the basis set out in the

offer and it must be communicated to the offer or - the person making the offer
8


- in the other to be effective. If the offeree - the person receiving the offer states that he or she accepts the offer subject to contract, that is, some variation

of the terms, then no contract is formed. This would be a qualified acceptance,
which constitutes a counter offer.

Issues may

arise as to whether the acceptance has been communicated.

Two

rules determine this:

e

The

reception

rule

applies

to

instantaneous

forms

of

communication, for example telephone calls. The contract is said to be
formed when the acceptance is received by the offeror.
e


The

postal

acceptance

communication

rule, when

there is the delay between

being sent and received,

for example

the

by post. The

contract is formed when the acceptance is sent by the offeree.
To avoid uncertainty, the offeror may specify the method and timing of
acceptance.

Agreement

on essential terms, for example price and delivery,

must be certain and not vague.
Consideration

For

a contract to be

enforceable

something

of value

must

be

given,

for

example a price, even if it is of nominal value, say £1.
Intention
It is assumed
particularly

in

that

contracting

commercial


parties

intend

circumstances.

This

to

create
is,

legal

however,

relations,
a

rebuttal

presumption — an assumption that can be contradicted — if there is contrary
evidence.


After you read:
1.


Complete the conversations with the correct legal agreement from A

opposite.
We rented a car for a week in
Austria.

The office’s windows are always
dirty. I want them cleaned
regularly by a firm of window
¬

You’ll need a good
0)

Ẽ6 8"...
..

cleaners.
I want to buy a new car but we
can’t afford to pay the whole price
at once.

I’m

going

to pay

You’ll need to check the interest rate on the


in

(3)

NR

c0...

229202222209 se set 0n

ve

monthly instalment.

We’re going to be living in

London for about 18 months, so

~N

we're 60IHIE.f0OTETLaTIAP c2

Make sure you get a reasonable (4)............
l6 2121711227020 1229622065xa705.s2s-r sen

I’m going to have to borrow a large

liry to/get'the!bets!(5) it. ta. eec cscs tscwcesseess

sum of money for about three years.


m3 7...

ˆWhat đid the (])...........
-.-.. -- -- - -- --- cover?

you can from your bank.

2. Make word combinations from B opposite using from the box.
contrary
parties

offer

conditions of

avoid

sale

qualified

essential

contracting

terms

contract


acceptance

counteruncertainty
3.

1.

evidence

subject to

Find answers to these FAQs

rebuttal

presumption

from a law firm’s website.

Find

reasons

for your answers in B opposite.
Building work started on a major construction project before all the elements

of the contract had been agreed. Both parties expected
agreement

would


not be a problem.

However,

final

that reaching an

agreement

was

never

reached and eventually the claimants stopped work and claimed for work
done. The defendants counter-claimed for the breach (break) in the contract.
10


Under English law, was there a contract?

. Helena applied for shares in a company. The shares were allotted to her and a
notice of allotment was posted to her. It never arrived.
Under English law, had she become a shareholder or not?

. Two

women


went

regularly

to

bingo

sessions

together

and

had

an

arrangement to share whatever they won. One of them won a bonanza (extra)

prize £1,107. She claimed it was not covered by the sharing arrangement.
Under English law, was their agreement legally binding?

11


UNIT 4: STRUCTURE

CONTRACT


OF A COMMERCIAL

Before you read: talk about these questions
1.

What is the typical structure of a commercial contract in a jurisdiction you are
familiar with?

2. What sort of standard wordings are used? Are these helpful?
Read the text below:
A- Structure of a commercial contract
Most

written

contracts

have

a similar

structure

consisting

of certain

essential

clauses, irrespective of the subject matter of the contract. The general pattern of


paragraphs can be:
Heading

For example, ‘Distribution Agreement’.

Commencement and Date
Usually a commercial contract contains a brief introduction which describes the

nature of the agreement, for example ‘This Agreement for the sale of...’ of “This

Share Agreement...’ . The commencement clause will state the date on which the

provisions, or conditions of the contract,

are to come

into effect.

The

date is

on
usually inserted in the relevant space at completion — the last stage in the formati
of a contract.

Parties

number

The full details of parties are set out. In a case of a company, the registered
e any
is included. This remains unchanged during the life of the company despit

Also known as Background

or Preamble.

These paragraphs

are traditionally

introduced by the word WHEREAS (conventionally, key words are in capital
letters or have an initial capital). The recitals consist of a statement of background
facts and the reasons why parties are to enter into the contract. Related or
preceding transactions may be used to determine construction, that I, interpret
intentions.

12

ee

changes of name or registered office.
Recitals


Operative provisions
Often introduced by the expression ‘The Parties Hereby Agree as follows...’ or

similar words, for example ‘ Whereby it is Agreed as follows...’. These words

signal the start of the operative part of the contract, containing various clauses
which create rights and obligations, or create and transfer interests in property.
Operative

provisions

in more

complex

agreements

may

refer to more

detailed

Schedules (see below).
Definitions

This section states the meaning to be attributed to terms essential to the contract —
the defined

terms.

Most

defined terms


are conventionally given capital initial

letters, for example Security Documents or Completion Date. In the absence of
definition, words within contract will be given their ordinary and natural meaning.

Interpretation
The aim of this section is to assist in the interpretation and construction of the whole
contract by referring to specific uses. There are a number of provisions included in

most contracts, for example

meaning and vice versa’.

‘Words denoting the singular include the plural

Conditions precedent
These pre-conditions must be satisfied in order for the agreement, or the relevant
parts of it, to come into effect, for example the grant of planning permission. The

conditions precedent clause stipulates, or imposes, obligations on the relevant

party to procure the satisfaction of the condition and provide a date by which
time the condition precedent must be satisfied. It is usual for an agreement to
terminate automatically if this is not achieved by the specified date.
Consideration

This sets out the consideration provided by the parties.
Other operative clauses

Including, for example, warranties, limitation and exclusion clause, and other

standard clauses such as governing law.
Schedules

Sections at the end of the contract containing specific provisions and documents, for
example the Transfer Deed in a contract for the sale of land.

4.

13


After you read:
I. Decide which part of a contract described in A opposite these extracts have
come from.
1.

“the Schedule.” In four Parts annexed and signed as relative to this Agreement.
“the Buyer” shall mean the purchaser of the goods from the Company.

2. The consideration for the sale and purchase of the Contract Shares shall be the net
asset value of the Company (subject to...) plus Three hundred and fifty thousand
pounds for goodwill subject to adjustment as follows...

3. WHEREAS

the Vendors have agreed to sell to the Purchaser, and the Purchaser

has agreed to Purchase, the entire issued share capital of Green Boots Limited

(“the Company”) on the terms set out in this Agreement.

4. THIS AGREEMENT

Boots

Limited

having

is made the Ist day of October 2007 BETWEEN

its registered

office

at 104

Warren

Court,

Green

Beeston,

Limited having its registered office at 6 Heel
referred to as “the Vendors” of the second part).

Street,

Darnley,


(hereinafter

5. The masculine includes the feminine and vice versa.

and subject to the
6. The sale and purchase hereby agreed is conditional upon
etion Date:following conditions being satisfied on or before the Compl
marketable lease
(i) the Vendors exhibiting to the Purchasers’ Solicitors a valid
the Property;
in the name of the Company free from any encumbrances to

effect and the parties shall
7. The provisions set out in the Fourth Schedule shall have

n.
undertake their respective obligations as specified therei

by CONTRACT AND AGREE as
8. THEREFORE the parties Have Agreed and Here
follows:-

————————————__—

on atti cá

(hereinafter referred to as “the Purchasers” of the first part) and Matching Socks

|



II. Replace

the

underlined

words

and

phrases

with

alternative words

and

phrases from A opposite. There is more than one possibility for one of the
answers. (1m)

1. In spite of the differences between the parties at the start of negotiations,
their intention was to form an agreement.
2. We, the Parties, in this way agree to purchase the Contract Shares

3. If a dispute arises with reference to the satisfaction of the pre-conditions,
the Purchasers may cancel the agreement.
4. Without the specified documents, the agreement cannot come into effect.


15


Sale Contract No: 33/HDXK/2017
Date: May 26, 2016

CONTRACT
Between (first party):

THE BUYER: LUCKY TOBACCO CO., LTD.
Address:D15, Bet Tran Commune,

Prey Nob District,

Ville Province, Cambodia

Tel: (855) 972112517
Represented by Mr. LY JOHN/Director
And (second party):

THE SELLER: VINH LONG TOBACCO CO., LTD.
Address: 8D Nguyen Truing Truce, Ward 8, Vine Long City, Vine Long Province,

Vietnam
Tel: +84 703823167

Fax: +84 703877115

Account No: 1120.21111.2177, Vietnam Joint Stock Commercial Bank for Industry

and Trade-Vine Long Branch, 1C Hoang Thai Lieu Street, Ward

1, Vine Long City,

Vine Long Province, Vietnam

Represented by Mr. Tran Hoang Nam/Director
Both parties agree to enter into this contract on the following terms and conditions,

subject to the general terms and conditions on the following pages:
1

COMMODITY/QUALITY/UNIT PRICE/TOTAL AMOUNT:

Commodity

Quantity

Filter Rod-Cigarette 132mm _ | 4,628

Unit Price/USD | Total USD
4,364

Total FOB-Ho Chi Minh

20,197.00

20,197.00

In words: Twenty Thousand, One Hundred and Ninety Seven U.S. Dollars only.

Il.

DELIVERY TERM:

FOB - HO CHI MINH,

VIETNAM

From: Ho Chi Minh City, Vietnam

16

-


To: Cambodia

Transshipment: Allowed
Partial shipment: Allowed

II.

SHIPMENT
The goods will be shipped before 30/6/2016.
II. PAYMENT: by TTR( Telegraphic Transfer Remittance)

Ly The buyer must make the deposit 100% contract value to the seller
before production.

2.


In case goods cannot be exported, the buyer agrees to lose the deposit.

3.

In case the buyer does not take the cargo within 03 months from the
production date, the paid amount will not be returned to the buyer by

the seller.
4.

Documents required:
e

Bill of Lading: original

¢

Signed commercial invoice: 01 original

e

Packing list: 01 original

5. Name and address of the Negotiating Bank:
Vietnam Joint Stock Commercial Bank for Industry and Trade-Vine
Long Branch,
Address:

1C Hoang Thai Lieu Street, Ward


1, Vine Long City, Vine

Long Province, Vietnam

Account No: 1120.0020.2188

Swift code: ICBVVNVX800

Beneficiary: VINH LONG TOBACCO CO., LTD.

IV.

WARRANTY

The seller warrants that products are delivered to the buyer to be free
days from
from defects in materials and workmanship for a period of 90

TRUONG DAI HOC CUU LONG

the production date.

17

THU VIEN
ricw

26 tb


7 ta


INSPECTION

The manufacturer’s inspection will be final. Products’ quality and

specification is the same sample approved by both parties.
;

CLAIM

All claims by the buyer shall be in telex or fax immediately after the
received cargo at destination port and shall be confirmed in writing and
delivered to the seller within fifteen (15) days after such discharge (for

claims of any kind and/or latent defects respectively).
vil.

ARBITRATION
Any

and all disputes arising from this contract not resolved through

conciliation

shall be referred to the Vietnam

International Arbitration


of Vietnam
Centre (VIAC) at the Chamber of Commerce and Industry
ration Rules of
(VCCI) for arbitration, in accordance with the Arbit
Vietnam International Arbitration Centre.

FORCE MAJEURE

enting the buyer and/or
In the case of unforeseeable circumstances, prev
to this contract, one party
the seller from fulfilling their commitments
r by telex or fax within
facing Force Majeure case should inform the othe
s within sixty (60) days,
ten (10) days and support with certified document
of telex or fax date.

OTHER

in writing and
Any changes and/or amendments to this contract shall be

subject to approval by both parties.

This contract is made in English language in 02 originals. Each party

keeps one original.

This contract goes into effect from the date of signing to 31/8/2017.


18

..

Vill.


FOR THE SELLER

FOR THE BUYER

Mr. Tran Hoang Nam/Director

Mr. Ly John/Director

(Signature & Seal)

(Signature & Seal)

QUESTIONS FOR DISCUSSION
1/ What are the basic contents of this sale contract?

2/ Who are the subjects in this contract?
3/ What is the merchandise in this contract?

=

4/ What are the limitations of dispute resolution in this type of contract?
5/ In your opinion, which contents in the contract should be amended

supplemented, if any?

and/or


UNIT 5: CORPORATION

TAX

Before you read: talk about these questions
are
1. How is corporation’s taxable income assessed in a jurisdiction you

familiar with?

2.

What tax benefits are available to corporations?

HM Revenue and
For more information on Corporation Tax in the UK, go to
Customs at: www.hemc.gov.uk/.

Read the text below:

A. Corporation Tax liability in the UK
income (for example from
Corporation Tax is the tax payable on a company’s
ple from the sale of assets) at the
investment in sh ares) or gains (for exam

used to prefer to the following, in
statutory rate. In this context ‘co: mpany’ is
of the word:
addition to the more conventional meaning
ions who might have trading
Members’ clubs, societies and associat
for example amateur sports
activities or income from non-members,
clubs

Trade

associations,

for example

the

associations

of British

Travel

for travel agents
Agents (ABTA), the regulatory body

ndent, not-for-profit bodies that
Hosing associations — in the UK, indepe


le in hosing need
provide low cost ‘social housing’ for peop
example cooperatives, but not
Groups of individuals on a business, for
partnerships (see Unit 19)

Corporation Tax on their profits in
All companies resident in the UK are subject t 0
company ma y also be subject to
an accounting period. A non-UK incorporated

within the UK.
Corporation Tax, if it is managed and controlled from

d Revenue — the UK tax authority — of
Although Companies House notifies the Inlan

registration, it is still responsibility of
of
on
leti
comp
on
any
comp
a
of
n
atio
form

the
liability to pay tax. This
and
ce
ten
€
xis
its
of
ue
Reven
the
inform
to
ny
the compa
20

¬


must be done within 12 months of the end of the company’s accounting period. An

accounting period starts when a company first becomes chargeable to Corporation
Tax or when the previous accounting period ends. It cannot exceed

12 months for

the purpose of tax. The normal due date for the payment of tax is no later than nine


months

plus one day after the end of the accounting period, although

large

companies — that is, those with annual profits in excess of a stipulated amount —
are obliged to pay their tax early by Quarterly Instalment Payments.
B. Word combination with ‘tax’
avoidance

trying legally to minimise the tax to be paid, for example by using
tax loopholes (gaps in the law)

benefits

advantages

bill

tax

demand for money owed in taxes

chargeable

tax that may be levied on profits

due


tax that has to be paid by a required date

efficiency

ways of reducing taxes owed

evasion

illegally trying to not pay tax

exemption

a principle permitting freedom from payment of tax. For example,
non-profit-making organisations may claim tax exemption.

point

date at which a tax begins to be applied

relief

help, allowing a company (or individual) not to pay tax on part of

their income

Tax Return _ form issued by the taxation authorities for declaration of income

and allowances, also known as a declaration
L_


21


After you read

A
Replace the underlined words and phrases with alternative words from
grammatical context. There is more than
opposite. Pay attention to the
one possibility for one of the answers.
le

Will you formally inform the Inland Revenue?

2:

and
I believe it’s a business run by a group of owners who share the profits
the work.
The figure named is currently £1.5 million.

es
We’re going to be taxed on_money received from sales of goods or servic

ees lie)

after costs have been deducted.

Geet


I.

How long have we got until the day on which payment is required?
There’ll be some tax on money from sale of assets this year.

due.
Don’t forget, you’ll have to pay tax by payment of part of the total sum
I don’t

think

there’ll

be much

tax

on

money

from

accounting period.
Profits aren’t going to be greater than £1 million this year.

22

investments


in this


II. Complete this extract from an advisory email from a solicitor with word
combinations from B opposite. Use each combination only once.

From:
To: Bertil.

Subject: UK tax liability
Dear Bertil, In answer to your query about UK tax liability, I’ve set out a

brief outline below. The responsibility for the calculation of the tax due lies
with the company.

Tax

is generally (1)

on the company’s

total

profits - including chargeable gains. A company must follow the special rules
in calculating
Company

Tax

the tax due and,

(2)

following this self-assessment,

to the

payment of tax (3)

Inland

Revenue

together

their income. Although there is no annual tax (5)
trading

losses

are

with

a
the

. If there has been expenditure on research and

development, companies many quality for special tax (4)


roll-over relief may

submit

on part of

for capital gains,

be available where business assets are replaced and
normally

set against

income

and

gains

of the same

accounting period or even of the previous year. The rules setting out these
reliefs and others are complex, and companies generally employ specialist
advisers to help maximise their use of the various reliefs in order to minimise
their tax (6)

. The fact that corporate tax rates in the UK

are lower


than income tax rates (to which individuals are subject), and that company
dividends (which the owners of a company can pay to themselves) are taxed
more lightly than other forms of income, means that businesses may opt to
incorporate primarily to enjoy such tax (7)

. Again, specialist

advice may be sought by non-incorporated businesses that wish to calculate
the tax (8)

of such an option.

23