Tax Accounting


INTRODUCTION TO TAX ACCOUNTING:
The subject Tax Accounting refers to an academic discipline in accounting with focus on taxation. It is the application of specific accounting practices to minimize one’s tax liabilities or to avoid paying unfair tax. Tax accountants must be well grounded in both tax and accounting as the individual should be able to prepare tax accounting statements with the full application of tax laws to avoid paying excess tax. The tax accountants play several roles in an organization, they assist in preparation of the entity’s financial reports, tax returns, answering tax questions and offering general tax accounting advice.

THE SCOPE OF TAX ACCOUNTING:
The core disciplines in the subject area of tax accounting are principles of accounting, principles of tax and tax law. The in-depth knowledge of accounting, taxation and tax law are the main foundations. With respect to the main accounts, whereas the financial accountant could generate the net profit with the application of the Generally Acceptable Accounting Principles, the tax accountant could equally generate the tax profit dwelling on the relevant tax laws in the country of application.

In view of the fact that tax laws differ from country to country, the basis of net profit derivative could change from country to country. Most African countries for instance have special tax incentives and exemptions in most of the following sectors: banking sector, savings and loan sector, rural banking sector, community banking sector, insurance sector, securities sector, financial investments sector, international banking sector, commercial banking sector, mining sector , oil, petroleum and gas sector, quarrying sector, trading/commerce sector, business vacation sector, investments sector, employment sector, education sector, hospitality sector, water and electricity sector, timber/forestry sector, pharmaceuticals sector, NGOs, brewery sector, production sector, health sector, automobile sector, shipping sector, surveying sector, farming sector etc.  Meaning the tax accountant must be abreast with the relevant tax laws in all the sectors for full application and comprehension of equitable tax assessments. The tax laws in the UK for instance cover the following; Income Tax ,Capital Gains Tax, Corporation Tax, Value Added Tax, Inheritance tax and Overseas Taxation. Other miscellaneous tax laws cover capital allowance and other taxtypes. Again the tax accountant must be abreast with the background tax laws, in these tax assessment areas.

MINIMUM QUALIFICATION & EXEMPTIONS: The minimum entry qualification is first degree in any subject discipline, qualified or part qualified accountant and other university, polytechnic, or college qualification.