The UK's EU referendum: All you need to know

On 23 June, the UK will settle a question that's been rumbling close to the surface of British politics for a generation: should the country remain within the European Union, or leave the organisation and go it alone.

Both sides insist that the outcome of the vote will settle the matter of Britain's EU membership for the foreseeable future.

This winter, he embarked on a tour of EU capitals as he sought to renegotiate Britain's terms of membership, which concluded at a summit in February. Presenting the result as a victory, he vowed to campaign with his "heart and soul" to keep Britain inside a "reformed" EU, but several members of his own Cabinet are campaigning for a British exit – or Brexit.

So what are the advantages and disadvantages of being a part of Europe? Would Britain be better off staying inside the club or going it alone?

European Union was originally formed with six nations in 1957. Today, it is a gigantic transnational entity of 28 countries, including the U.K., which joined only in 1973. Though part of EU, Britain has traditionally had a 'eurosceptic' stand. It continues to use the Pound as its currency, while most EU nations have moved to Euro. Neither does it participate in the Schengen border-free zone, which allows passport-free travel in EU.

Interestingly, this is the second time U.K. has sought a referendum on this issue. In 1975 Prime Minister Harold Wilson called a referendum after considerable opposition rose from within the country on U.K. staying with the European Economic Community, the precursor of the EU. With 67 per cent of those who voted preferring to 'Remain', U.K. stayed on.

Much of the EU’s money comes from its member states. And the UK is one of the larger contributors.

The money is spent on administration of the EU in each member country, aid activities outside the EU, grants for asylum, education and culture, on preserving and managing natural resources (this includes, agriculture, fishing, mining and so on), helping poorer countries in Europe and in grants to research in science and technology and in helping small businesses.

A British exit from the European Union would rock the Union — already shaken by differences over migration and the future of the eurozone — by ripping away its second-largest economy, one of its top two military powers and by far its richest financial centre.

This could also give rise to more nations contemplating exit from the Union. Greece, last year held a referendum in which its citizens overwhelmingly rejected EU's bailout norms.

Finance Minister Wolfgang Schäuble had asked “How would the Netherlands react, for example, which is traditionally very strongly linked with Great Britain?”