How to teach … tax

http://www.theguardian.com/education/2012/jul/24/teaching-resources-tax-guardian-teacher-network

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It's been a bad news month for HSBC after The Guardian and other media outlets revealed its private banking arm turned a blind eye to arms dealers' illegal activities and helped wealthy customers evade tax.

Millions of dollars of assets were concealed, and HSBC is now being investigated by Swiss officials for money laundering. France, Belgium, Spain, the US and Argentina have launched legal proceedings against HSBC and its wealthy private clients.

The good news for teachers is that the story provides plenty of opportunity to engage students in lessons about tax – without boring them to tears. So, this week the Guardian Teacher Network takes a timely look at how to help students understand taxes and why we have to pay them.

HM Revenue and Customs (HMRC) has a useful resource that introduces the basics for key stage 3 and 4 students, including how to explain what income tax is and why national insurance numbers are important. The HMRC income tax quiz is also helpful for gauging how much students have learned and retained. If you click on the income tax section of the Tax Matters website, it will navigate you to the quiz that includes questions such as, what PAYE stands for and whether you must pay tax on the tips you earn in restaurants.

Another set of resources from pfeg include practical ideas and activities to explore how public money is raised and spent, and what a pay slip is. There are also resources exploring the question of where money comes from when people get older – looking at national insurance, the state pension and workplace pensions. This resource is free but to access it you need to register on the website.

Alongside these lessons, ask students to think about how society operates – and gather their ideas about what taxes pay for and how the government raises money. Finally, ask your class to estimate how much it costs to run the UK.

Once you've covered the basics, it might be interesting to look at some of the issues raised in the HSBC investigation. This resource from The Day is a great explainer for what has happened at the bank and includes a taxing debate topic, "this house believes the rich should be taxed more than the poor". Split your class into two groups and get each side to argue for or against the premise. Compare a society where the government takes all income as tax and one where the government takes none. What problems would there be?

For a handy roundup of the HSBC story so far, and to give your class some background, the Guardian has an easily digestible guide on what we know so far. It also links to key pieces of journalism which can be a useful launch point to explore the latest findings.

You could also delve into the past with other tax avoidance scandals. Jimmy Carr's tax deal becomes David Cameron's headache explores K2, the (legal) Jersey-based tax avoidance scheme used by Carr and another thousand beneficiaries which sheltered £168m from the taxman.

The Day has another topical resource that looks at Labour plans to tax valuable property and levy banker bonuses if it wins the next general election. You could ask students to think about whether this could result in a fairer society or set them a short essay about whether the tax system should consider the interests of the individual first or society as a whole. Another topical resource examines the coffee shop chain Starbucks and why, despite making millions in coffee sales, it pays next to nothing in taxes.

If you want to take the topic of wealth inequality further, modern studies teacher of North Berwick high school, Gordon Docherty, has put together a useful resource. His powerpoint looks at what makes someone wealthy, exploring the issues of inequalities in the UK. What does it take to be a top earner? Get students to rank people in order of who should earn the least and the most. Docherty also has a useful lesson plan to teach tax for key stages 5 and 6. It explores the welfare state, government spending and regressive taxation.

Finally, to explore this topic in primary school there is useful stuff to be found on Natwest's key stage 2 resource Pocket Money. It's structured around four themes: using money, money and me, all about banks and money for life. Each topic includes eight lesson plans. It can be used to teach young students about the wider role of money in society, from jobs and household bills to taxes and government services.

• This article was updated with new teaching resources on Monday 23 February 2015. It was first published on 24 July 2012.

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