CIMA F1 Syllabus C. Fundamentals Of Business Taxation - Other terms - Notes ^{6 / 10}

Taxable Person

• The person liable to tax

• Can be a company too

Formal Incidence of a tax

• On the person with direct contact with the tax authorities

Effective Incidence of a tax

• On the person who actually pays the tax

So you buy some goods from a company.

The FORMAL INCIDENCE OF THE VAT is on the company

The EFFECTIVE INCIDENCE OF THE VAT is on you!

Competent Jurisdiction

• Jurisdiction means the power to collect the tax

• Competent Jurisdiction is the authority whose tax laws apply