Taxes and Accounting
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Taxes
A tax is a compulsory financial charge or another type of levy imposed on a taxpayer, an individual or a legal entity, by a governmental organization in order to fund government spending and various public expenditures. Tax compliance refers to policy actions and individual behaviour aimed at ensuring that taxpayers are paying the right amount of tax at the right time and securing the correct tax allowances and tax reliefs.[1] Non-compliance, along with evasion of or resistance to taxation, is punishable by law. Although concealing assets in tax havens is an illegal practice that is frowned upon, it still seems to be a common practice.
In order to finance their operations, some countries can levy a flat percentage rate of taxation while other countries may impose a progressive tax depending on the amount of annual income. Taxes are charged on an individual´s income and on corporate income, and they consist of direct or indirect taxes. The most common types of taxes are value added tax (VAT), payroll tax, property tax, inheritance tax, capital gains tax or duties and tariffs imposed on import and export of goods.[2]
Individuals with tax liability, such as self-employed people or employees with income from outside their employment, need to file a tax return at the end of the financial period, listing the amount of money made over the financial year. In the Czech Republic, sole traders must pay advances for pension insurance and public health insurance. Some of the costs incurred throughout the year may be tax deductible. These may include deductions for children, a non-working spouse, or mortgage interest. If the individual´s income exceeds CZK1 million, they are obliged to register for VAT.[3]
The completed tax return is forwarded to the relevant tax authority where the individual is registered. The authority audits the information and sends the individual a tax assessment notice. If the taxpayer has paid too much in taxes, they receive a tax refund (tax rebate).
Accounting
Accounting is the process of measuring, processing, and sharing financial and other information about businesses and corporations while keeping the accounting books of the financial transactions of the company. The accountants summarize the transactions in the form of journal entries. These entries are used in bookkeeping. The books of accounts are prepared for the auditors and various regulating bodies. The accountants might follow the Generally Accepted Accounting Principles (GAAP) or the IFRS (International Financial Reporting Standards) principles.[4]
The accounts books give an overview of the company´s financial situation. This is particularly important for publicly listed companies, as it determines their value on the market.
There are several types of accounting. Financial accounting deals with preparing interim and annual financial statements. Managerial accounting uses the accounts books to prepare reports for management to make decisions on the company strategies, budgets and forecasts. Cost accounting calculates the cost of making a product.
Companies are obliged by law to publish financial statements showing how the company is being run and how the money is being used. There are three basic financial statements; balance sheet, profit and loss account, and cash-flow statement.
The balance sheet (the statement of financial position) gives the stakeholders an understanding of the company´s assets and its liabilities at the end of a particular period. While assets show items of property or value, liabilities are debts that will have to be paid.
Assets are divided into current assets and fixed assets. Current assets are those that can be relatively easily liquidated. These include cash, securities, stocks, raw materials or debtors (accounts receivable or receivables), fixed or tangible assets such as land or machinery, and intangible assets including intellectual property and goodwill of the company. As tangible assets wear out and become obsolete, they lose value, i.e. depreciate and therefore their value is gradually written down until it is written off.
Liabilities can be divided into current and long-term. Current liabilities, such as creditors (accounts payable, payables), overdrafts, interest payments or taxes need to be paid within a year while the maturity of bank loans or bonds is longer.
The profit and loss account (the income statement) records the money the company makes over the financial period. It shows the stakeholder whether the company made a profit or a loss over that time. It shows the revenue and expenses of the company. The top line of the statement shows the revenue (also sales or turnover) over the period. From that the company needs to deduct expenses for running the business, such as the cost of goods sold (COGS), selling and general expenses and depreciation. This shows the operating profit from which interest and other items should be deducted. After the company pays corporate taxes, they are left with profit after tax. Should the company decide to pay out dividends to shareholders, these would be paid from the profit after tax. What the company keeps is called retained earnings.
The cash-flow statement summarizes the movement of cash and cash equivalents (CCE) that come in and go out of a company. The CFS measures how well a company manages its cash position, meaning how well the company generates cash to pay its debt obligations and fund its operating expenses.[5]
Glossary
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Seznam použitých symbolů a zkratek
↻ uvozuje slovo nebo frázi se stejným nebo podobným významem (synonymum) 📖 uvozuje slovo nebo frázi s opačným významem (antonymum), případně podobně znějící výraz s odlišným významem [ ] obsahuje přepis výslovnosti ( ) obsahuje vysvětlení (například zkratky nebo zpřesnění významu), doplnění nebo část výrazu či slova, která může být v závislosti na kontextu vynechána i upozorňuje na nepravidelné (irregular) sloveso vyšší než mírně pokročilé úrovně a tím zároveň odkazuje na seznam těchto nepravidelných sloves na konci glosáře / zkracuje dvě (nebo i více) stejné syntaktické konstrukce do jediné (například „dosáhnout/docílit čeho“ místo „dosáhnout čeho, docílit čeho“) adj přídavné jméno (adjective) AmE výraz z americké angličtiny (American English) BrE výraz z britské angličtiny (British English) C počitatelné podstatné jméno (countable) n podstatné jméno (noun) pl množné číslo (plural) sb zájmeno někdo, uváděné po předložkách a/nebo slovesných vazbách (somebody) sg jednotné číslo (singular) sth zájmeno něco, uváděné po předložkách a/nebo slovesných vazbách (something) U nepočitatelné podstatné jméno (uncountable) -
Glossary
accountant ‹n› účetní accounting ‹n› účetnictví annual ‹adj› roční, každoroční, výroční assets ‹n; pl› aktiva, jmění (podniku) balance sheet ‹ BrE› (účetní) rozvaha bond ‹n› dluhopis bookkeeping ‹n› účetnictví (denní vedení účetních záznamů) budget rozpočet to budget sth zahrnout co do rozpočtu, vyhradit co v rozpočtu capital gains tax daň z kapitálových zisků, daň z výnosů z kapitálu cash ‹n;U› hotovost cash equivalent peněžní ekvivalenty (snadno a pohotově směnitelné prostředky) cash-flow statement přehled pohybu hotovosti, výkaz cash flow compliance with sth
[kəmˈplaɪ.əns]soulad s čím, dodržování čeho to comply with sth
[kəmˈplaɪ]být v souladu s čím, vyhovovat čemu to conceal sth
[kənˈsiːl]zatajit/skrýt/nepřiznat co corporate income příjem firmy, příjem společnosti cost accounting nákladové účetnictví, účtování nákladů cost of goods sold (COGS) přímé náklady vynaložené na prodané zboží creditor ‹n› věřitel creditor ‹BE› (↻ accounts payable, payables ‹AmE›) závazky (z obchodních vztahů) current assets (o)běžná/krátkodobá aktiva, oběžný majetek current liabilities krátkodobé závazky debtor ‹BE› (↻ accounts receivable, receivables (‹AmE›) pohledávka debtor ‹n› dlužník to deduct sth odečíst deduction ‹n› odpočet, srážka (např. z daně) to depreciate
[dɪˈpriːʃieɪt]zde: odepisovat, amortizovat depreciation ‹n›
[dɪˌpriːʃiˈeɪʃ(ə)n]zde: odpis, amortizace; snížení hodnoty dividend ‹n› dividenda, podíl na zisku duty ‹n› on sth clo na co to exceed sth
[/ɪkˈsiːd]překonat/přesáhnout co expenses ‹pl› výdaje, výlohy to file sth
[faɪl]podat (úředně žádost, žalobu ap.) financial accounting finanční účetnictví financial statement finanční výkaz to fire sb ‹infml› (↻ to sack) vyhodit/vyrazit koho (z práce) fixed assets stálá aktiva, hmotný investiční majetek flat percentage rate paušální procentní sazba, rovná daň to forecast sth předvídat, odhadovat to frown upon sth
[fraʊn]nelibě nahlížet na co, neschvalovat co game-changer přelom, zvrat, hybatel (změn) general expenses obecné náklady goodwill ‹n› goodwill, (hodnota) renomé (firmy, hlavně ve finančním vyjádření) to impose sth on sb uložit/uvalit co na koho to impose a tax on sth uvalit daň na co, zdanit co income ‹n› příjem inequality ‹n›
[ˌɪnɪˈkwɒləti]nerovnost, nestejnost (v postavení apod.) inheritance tax dědická daň injustice ‹n› nespravedlnost, křivda, bezpráví insurance ‹n› pojištění to insure sb/sth against sth pojistit koho/co proti čemu intangible assets nehmotná aktiva, nehmotný majetek intellectual property (IP) duševní vlastnictví interest ‹n;U› úrok interim ‹adj› prozatímní, dočasný leaker ‹n› vynašeč, zdroj (tajných informací) legal entity právnická osoba, právní subjekt legal fight soudní bitva legitimacy of sth zákonnost/legitimita čeho levy ‹n›
[ˈlevi]odvod, poplatek, daň to levy a tax on sth uvalit daň na co, zdanit co liability ‹n›
[ˌlaɪəˈbɪləti](fin.) závazek, pasivum to liquidate (assets) rozprodat, zpeněžit (aktiva podniku) managerial accounting manažerské účetnictví maturity ‹n› splatnost, datum splatnosti mortgage ‹n›
[ˈmɔː(r)ɡɪdʒ]hypotéka non-compliance with sth neuposlechnutí čeho, nevyhovění čemu obsolete ‹adj›
[ˈɒbsəliːt]zastaralý, překonaný to offset sth vyrovnat, vykompenzovat offshore account účet v zahraničí (zejména kvůli nižším daním) operating profit provozní zisk overdraft ‹n› přečerpání účtu, kontokorent to overview sth prohlédnout co, dohlížet na co payroll tax daň ze mzdy pension ‹n› (fin.) důchod, penze profit after tax zisk po zdanění profit and loss account ‹ BrE› (↻ income statement ‹AmE›) výkaz zisků a ztrát, výsledovka progressive tax progresivní systém zdanění, progresivní daň property ‹n› majetek, nemovitost, reality publicly listed company veřejně obchodovatelná společnost (registrovaná na burze) punishable ‹adj› trestný, trestně postihnutelný regulating (regulatory) body regulační úřad/orgán resistance ‹n› to sth odpor, vzdor vůči čemu retained earnings nerozdělený zisk revenue (↻ sales, turnover) (fin.) obrat, tržby security ‹n› záruka, zajištění self-employed ‹adj› samozaměstnavatel, samostatná výdělečně činná osoba (neoznačuje právní formu podnikání) selling expenses prodejní náklady, náklady na prodej share ‹n; BrE› (↻ stock(s)) akcie; podíl (ve firmě) shareholder ‹n› akcionář, podílník spouse ‹n› choť, manžel/manželka stakeholder ‹n› zúčastněná strana, zainteresovaná osoba tangible ‹adj›
[ˈtændʒəb(ə)l]hmotný, hmatatelný tangible asset hmotná aktiva tariff ‹n› clo, celní tarif tax ‹n› daň tax allowance nezdanitelná částka tax assessment notice oznámení o vyměření daně ↻ tax bill oznámení o vyměření daně ↻ tax demand oznámení o vyměření daně tax authority daňový úřad tax avoidance snižování daňového základu (legálními prostředky) tax-deductible ‹adj› odpočitatelný z daňového základu tax evasion daňová zpronevěra, daňový únik (nelegální) tax filing
[tæks ˈfaɪlɪŋ]podání daňového přiznání tax haven
[tæks ˈheɪvn]daňový ráj tax liability daňová povinnost tax refund (↻ tax rebate) vrácení přeplatku daně tax relief daňová úleva, daňové zvýhodnění tax return (↻ tax declaration) daňové přiznání taxation ‹n› zdanění; daňový systém theft ‹n›
[θeft]krádež value ‹n› hodnota, cena value added tax (VAT) daň z přidané hodnoty (DPH) to wear out opotřebovávat/ unavit se (zde: o materiálu a vybavení firmy) whistle-blower ‹n› oznamovatel (nekalých praktik), interní informátor (hl. zevnitř organizace)
Definitions
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Taxes
assets something valuable belonging to a person or organization that can be used for the payment of debts capital gains tax a tax on the profits made from selling property or investments compliance the act of obeying an order, rule, or request conceal to prevent something from being seen or known about corporate income the money left over after a corporation pays all of its expenses deduction an amount that is taken away from the money you are paid before you officially receive it duty a tax paid to the government, especially on things that you import into a country exceed to be greater than a number or amount, or to go past an allowed limit file to officially record something for an authority or a court of law flat percentage rate a tax that is the same for everyone health insurance an agreement in which an insurance company agrees to pay for some or all of your medical expenses in exchange for a monthly premium payment impose to officially force a rule, tax, punishment, etc. to be obeyed or received income money that is earned from doing work or other investment incur to be made to lose money or have to pay a charge inheritance tax a tax paid on the value of the property, money, and other assets of someone who has died insurance an agreement in which you pay a company money and they pay your costs if you have an accident, injury interest money that is charged by a bank or other financial organization for borrowing money legal entity a company or organization that has legal rights and responsibilities, for example the right to make contracts and the responsibility to pay debts levy an amount of money, such as a tax, that you have to pay to a government or organization mortgage an agreement that allows you to borrow money from a bank or similar organization, especially in order to buy a house, or the amount of money itself non-compliance the fact of not obeying a rule or law, especially one that controls a particular industry, or type of work or activity payroll tax a tax paid on the wages and salaries of employees to finance social insurance programs, healthcare, and unemployment insurance pension an amount of money paid regularly by the government or a private company to a person who does not work anymore because they are too old or have become ill pension insurance an investment-led life insurance policy that helps policyholders to accumulate money over the investment years that provides for a comfortable retirement progressive tax a tax in which the rate of tax is higher on larger amounts of money punishable e.g. crime that can be punished resistance the act of fighting against something that is attacking you, or refusing to accept something self-employed a person not working for an employer but finding work for themselves or having their own business tariff a tax or duty to be paid on a particular class of imports or exports tax money paid to the government that is based on your income or the cost of goods or services you have bought tax allowance the amount of income on which you do not have to pay tax tax assessment notice information about the value determined to pay in tax tax authority an organization with official responsibility for collecting taxes tax deductible if an amount of money that you spend is tax-deductible, it can be taken away from the total amount of income you must pay tax on. tax evasion ways of illegally paying less tax than you should tax haven a place where people pay less tax than they would pay if they lived in their own country tax liability an amount of tax that a person or business must pay tax rebate a payment made to a taxpayer for any excess amount paid in taxes to the federal or state government tax refund a payment made to a taxpayer for any excess amount paid in taxes to the federal or state government tax relief the system of allowing someone not to pay tax on a part of their income tax return a form that some people must fill in to give information about how much they have earned in a year taxation the system of taxing people taxpayer a person who pays a percentage of their income to the government as tax value added tax (VAT) a consumption tax on goods and services that is levied at each stage of the supply chain where value is added, from initial production to the point of sale -
Accounting
accountant a professional who keeps or examines the records of money received, paid, and owed by a company or person advance money paid before something happens annual happening once every year balance sheet a statement that shows the value of a company's assets (= things of positive value) and its debts bond an official paper given by the government or a company to show that you have lent them money that they will pay back to you at a particular interest rate bookkeeping the job or activity of keeping an exact record of the money that has been spent or received by a business or other organization budget a plan to show how much money a person or organization will earn and how much they will need or be able to spend cash money rather than shares, bonds, etc. cash equivalent money in a company's bank accounts and other assets that can easily be changed into money cash-flow statement a document that shows the money coming into and going out of a company during a particular period cost accounting the process in which all the costs of a business activity or production process or activity are examined in order to help managers decide how to make profits or save money cost of good sold (COGS) the amount of money that a company spends in order to make and sell products in a particular financial period, for example, on wages and raw materials creditor (accounts payable, payables) the amounts in a company's accounts that show money owed by the company current assets an asset such as cash, raw materials, parts, or products that are still being made, which a company will use up or sell during the same year current liability a payment that a company must make within 12 months debtor (accounts receivable or receivables) money that is owed to a company and that is shown in its accounts as an asset deduct to take away an amount or part from a total depreciate to lose value, especially over time depreciation the process of losing value dividend part of the profit of a company that is paid to shareholders expenses an amount of money that a person or business spends in order to do something financial accounting a type of accounting that deals with providing financial reports about a company's profits, debts, cash flow, etc. so that investors, banks, etc. can measure the company’s performance financial statement a report provided by a company for its shareholders and investors that shows details of its financial situation, and includes documents such as the profit and loss account and balance sheet fire sb to remove someone from their job, either because they have done something wrong or badly, or as a way of saving the cost of employing them fixed assets land, buildings and equipment that are owned and used by a company forecast to say what you expect to happen in the future game-changer an event, idea, or procedure that effects a significant shift in the current way of doing or thinking about something general expenses money that a company spends on organizing and controlling its activities generally rather than on a particular product or service that it produces goodwill part of a company's value that includes things that cannot be directly measured, for example, its good reputation or its customers' loyalty inequality the unfair situation in society when some people have more opportunities, money, etc. than other people injustice a situation in which there is no fairness and justice intangible asset something valuable that a company has that is not material, such as a good reputation interim a part of a company's business year, rather than the whole year leaker someone who allows secret information to become generally known liability the amount of money that a person or organization owes managerial accounting the activity of preparing and using financial information about a company in order to support management decisions maturity the time when an insurance agreement or investment becomes ready to be paid obsolete no longer used or needed, usually because something newer and better has replaced it offshore accounts accounts of companies and banks based in a different country with different tax rules that cost less money operating profit a company's profit from its normal business activities, not including any earned from investments or sales of assets, calculated by taking operating expenses away from gross income overdraft an amount of money that a customer with a bank account is temporarily allowed to owe to the bank, or the agreement which allows this overview a short description of something that provides general information about it, but no details profit after tax the earnings of a business after all income taxes have been deducted profit and loss account a document that shows a company's profit or loss in a particular period property a building or area of land, or both together publicly listed company a company whose shares can be bought and sold by the public regulating (regulatory) body an organization whose job is to control an activity or process or regulations themselves retained earnings the part of a company’s profit in a particular period that it decides to keep, rather than paying it to shareholders as a dividend revenue (sales, turnover) money that a company receives, especially from selling goods or services security a financial investment such as a bond or share that is traded on a financial market selling expenses the costs of marketing and selling a product or service shareholder a person or organization that owns shares in a company stakeholder a person such as an employee, customer, or citizen who is involved with an organization, society, etc. and therefore has responsibilities towards it and an interest in its success stock a supply of something for use or sale tangible asset a physical asset whose value can be easily measured, such as cash, property, goods, or machinery theft the act of dishonestly taking something that belongs to someone else and keeping it value how much something is worth in money or other goods for which it can be exchanged wear out to use something so much or for so long that it is no longer usable whistle-blower a person who tells someone in authority about something illegal that is happening, especially in a government department or a company