Why Children Should Learn About Tax – Even Before They Have a Job

When teaching children money skills, we often focus on saving, budgeting, and spending. But tax is just as important. Learning about it early helps children understand the world, value public services, and prepare for adult life.

What Is Tax? (In Simple Terms)

Tax is money that people and businesses pay to the government. In the UK, this money is collected by HM Revenue & Customs (HMRC) and is used to pay for things that benefit everyone – like schools, hospitals, roads, and emergency services.

Why Teach It Early?

1. It Builds Real-World Awareness

Children see adults earning money – but they might not realise that what you earn isn’t always what you take home. Introducing the idea of tax helps them understand payslips, receipts, and why prices include VAT.

2. It Links to Everyday Life

From VAT on sweets to Council Tax for rubbish collection, taxes are part of daily life. Knowing about them helps kids connect the dots between what they see and how it’s paid for.

3. It Encourages Social Responsibility

Taxes fund services we all rely on. Teaching children about tax shows them how we each contribute to the community and why paying it honestly matters.

4. It Prepares Them for the Future

When they get their first Saturday job or holiday work, tax won’t be a surprise. They’ll understand why their payslip shows deductions and what those deductions mean.

Let's talk about statistics:

When teaching children money skills, we often focus on saving, budgeting, and spending. But tax is just as important. Learning about it early helps children understand the world, value public services, and prepare for adult life.

The reality is, many young people are already facing complex financial challenges before they even leave school. According to Young Enterprise and reported in The Times, over half (52%) of UK teenagers had experienced debt before turning 17. That’s a sobering reminder that financial education—including topics like tax—shouldn’t wait until the first payslip arrives.

By introducing tax in a simple, age-appropriate way, we can help children see how money flows through society, why contributions matter, and how to plan for the deductions they’ll face as earners in the future.

Common Misconceptions Kids Have About Tax

• “The government keeps it for themselves.” → Explain that tax is pooled to pay for services everyone uses.

• “It’s like a fine.” → Show them it’s a planned contribution, not a punishment.

• “It only applies to adults.” → Point out VAT on the things they buy now.

  
  

Final Thought

Tax might feel like a grown-up subject, but it’s part of everyday life – and the earlier children understand it, the better equipped they’ll be for adulthood. By making tax relatable and linking it to the services they benefit from now, you’re helping them develop a well-rounded understanding of money and how society works.

Ready to Level Up Their Financial Skills?

📘 Book a Smartmonies lesson today and help your child begin building essential financial skills for life.

🎁 Use code SMARTSAVER and get £10 off your first session!