Page "Tax" Paragraph 27

Personal income tax is often collected on a pay-as-you-earn basis, with small corrections made soon after the end of the tax year.

These corrections take one of two forms: payments to the government, for taxpayers who have not paid enough during the tax year ; and tax refunds from the government for those who have overpaid.

Income tax systems will often have deductions available that lessen the total tax liability by reducing total taxable income.

They may allow losses from one type of income to be counted against another.

For example, a loss on the stock market may be deducted against taxes paid on wages.

Other tax systems may isolate the loss, such that business losses can only be deducted against business tax by carrying forward the loss to later tax years.