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TX Accumulated Knowledge > (A) Self-Assessment > Flashcards

(A) Self-Assessment Flashcards

1
Q

An individual completing AN ANNUAL TAX RETURN on paper deadline?

A

31 October following the end of the tax year

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2
Q

An individual completing AN ANNUAL TAX RETURN electronically?

A

31 January following the end of the tax year

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3
Q

When must new sources of income or gains be notified to HMRC?

A

5 October, six months of the end of the tax year

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4
Q

When is the deadline for a taxpayer to correct their return?

A

On or before 31 January 2026 if tax year was 2023-24 (12 months following the prescribed filling date (31 January 2025)

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5
Q

When can HMRC correct obvious errors in taxpayer’s return?

A

Within 9 months of the date of receipt

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6
Q

Persons conducting a trade or property letting business must retain all records must retain all records for?

A

Five years after the filing date (31 January 2030 for 2023-24 purposes)

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7
Q

Persons not conducting a trade or property letting business must retain all records must retain all records for?

A

One year after the filing date (31 January 2026 for 2023-24 purposes)

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8
Q

What happens on 31 January 2024 for payment of tax? (Year 2023-24)

A

Make first payment on account of 2023-24 income tax/Class 4 NIC

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9
Q

What happens on 31 July 2024 for payment of tax? (Year 2023-24)

A

Make second payment on account of 2023-24 income tax/Class 4 NIC

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10
Q

What happens on 31 October 2024 for payment of tax? (Year 2023-24)

A

Submit 2023-24 tax return if filing paper return

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11
Q

What happens on 31 January 2025 for payment of tax? (Year 2023-24)

A

Make final balancing payment of 2023-24 income tax/Class 4 NIC

Make first payment on account of 2024-25 income tax/Class 4 NIC

Make only payment of 2023-24 CGT/Class 2 NIC (and balancing payment of CGT if residential property disposal)

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12
Q

When are no payments on account required? (Less than £1000)

A

The income tax payable + Class 4 NIC liability for the preceding year is LESS THAN £1,000

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13
Q

When are no payments on account required? (More than 80%)

A

More than 80% of the income tax payable + Class 4 NIC liability for the preceding year was settled by deduction at source (i.e. PAYE).

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14
Q

What is the filing date for tax year 2023-24?

A

31 January 2025

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15
Q

Failing to retain tax records maximum penalty?

A

£3000

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16
Q

Balancing payments surcharges of income tax late penalty payments (30 days after)?

A

5% of the tax unpaid 30 days after the due date

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17
Q

Balancing payments surcharges of income tax late penalty payments (6 months after)?

A

A further 5% of the tax unpaid more than six months after the due date

10% in total

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18
Q

Balancing payments surcharges of income tax late penalty payments (12 months after)?

A

A further 5% of the tax unpaid more than 12 months after the due date

15% in total

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19
Q

What are the quarter days?

A

31 January

30 April

31 July

31 October

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20
Q

Notice of commencing (compliance check) an enquiry into a submitted tax return must be given?

A

12 months of the actual submission date (e.g. by 31 December 2025 for an individual’s return submitted on 31 December 2024)

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21
Q

Notice of commencing (compliance check) an enquiry into a submitted tax return if a return is filed after the due submission date (i.e. it is filed late)?

A

The quarter day following the first anniversary of the actual filing date

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22
Q

When is discovery assessment for four years?

A

If tax lost is not due to the careless or deliberate behaviour of the taxpayer

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23
Q

When is discovery assessment for six years?

A

If tax lost is due to the careless behaviour of the taxpayer

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24
Q

When is discovery assessment for twenty years?

A

If tax lost is due to deliberate understatement or concealment (i.e. fraud) by the taxpayer.

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25
Q

Deliberate and concealed maximum?

A

100%

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26
Q

Deliberate and concealed minimum (with unprompted disclosure by taxpayer)?

A

30%

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27
Q

Deliberate and concealed minimum (with prompted disclosure by taxpayer)?

A

50%

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28
Q

Deliberate but not concealed maximum?

A

70%

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29
Q

Deliberate but not concealed minimum (with unprompted disclosure by taxpayer)?

A

20%

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30
Q

Deliberate but not concealed minimum (with prompted disclosure by taxpayer)?

A

35%

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31
Q

Careless maximum?

A

30%

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32
Q

Careless minimum
(with unprompted disclosure by taxpayer)?

A

0%

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33
Q

Careless minimum (with prompted disclosure by taxpayer)

A

15%

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34
Q

What must taxpayer do within 30 days from the receipt of the statutory review offer?

A

Accept the offer of a statutory review

Appeal directly to an appeal tribunal

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35
Q

When must written notice of appeal be given?

A

Within 30 days of the assessment or amendment being issued.

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36
Q

HMRC must state its view of the disputed matter (HMRC statutory review process)

A

Within 30 days of the taxpayer’s request

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37
Q

When HMRC has offered the review (HMRC statutory review process)

A

The taxpayer must accept the offer (in writing) within 30 days

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38
Q

When must HMRC conclude the review (HMRC statutory review process)

A

Within 45 days

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39
Q

What can happen within 30 days of completion of an HMRC statutory review (or the time limit for the review process having expired)?

A

The taxpayer may appeal to the tax tribunal

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40
Q

What is paper track?

A

Simple cases (e.g. an appeal against a fixed penalty) are settled by exchange of documents without any formal hearing.

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41
Q

What is basic track?

A

Case resolved by exchange of documents followed by a formal hearing

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42
Q

What is standard track?

A

Case resolved as for Basic Track, but procedure is more detailed and formal.

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43
Q

What is complex track?

A

Resolved as for Basic Track, but cases typically involve complex technical/legal principles or large sums of money.

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44
Q

When must a company notify HMRC of its first accounting period?

A

Within three months of when it started trade

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45
Q

Corporation tax return submitted for 31 March 2024?

A

31 March 2025

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46
Q

Calculate error for maximum penalty for carelessness (trading income)?

A

Trading income * (income tax % + NIC %) * penalty %

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47
Q

Official rate of interest?

A

2.25%

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48
Q

Rate of interest on underpaid tax?

A

6.5%

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49
Q

Rate of interest on overpaid tax?

A

3%

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50
Q

What is the filing date for income tax (2023-24)?

A

31 January 2025

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51
Q

What is the time limit to correct an income tax return (31 january 2025)?

A

12 months after the prescribed filing date

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52
Q

When can an amendment be made for a tax return?

A

Within 12 months of the prescribed filing date (31 January)

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53
Q

When can HMRC initiate a compliance check be made for a tax return?

A

Within 12 months of the actual filing date

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54
Q

Relevant amount for payment on account for income tax and NIC?

A

Total amount of income tax charged + NIC - tax deducted at source on company loan stock/ (2022/23 figures are used for 2024/24)

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55
Q

WHat does “more than 80% of tax deducted at source” mean?

A

PAYE in proportion of income tax liability

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56
Q

What is and isn’t included when determining the payment on account?

A

Included: Income tax liability and class 4 NIC

Not included: Capital gains tax liability

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57
Q

When is the balancing payment in respect of her tax liability for the tax year 2022-23 due?

A

31 January 2024

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58
Q

Compliance vs amendment?

A

Amendment - prescribed filing date

Compliance - actual filing date

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59
Q

When is a determination done?

A

If notice has been served on a taxpayer to submit a return but said return is not submitted by the filing date

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60
Q

Maximum penalty for the daily penalties?

A

90 days * £10 = £900

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61
Q

When must a company notify HMRC of it’s first accounting period?

A

Within 3 months of trading

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62
Q

When current year tax payable is less than previous year (calculating tax payable)?

A

Use current year for payments on account rather than the previous year

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63
Q

PAYE monthly penalty for number of employees 1 to 9?

A

£100

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64
Q

PAYE monthly penalty for number of employees 10 to 49?

A

£200

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65
Q

PAYE monthly penalty for number of employees 50 to 249?

A

£300

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66
Q

PAYE monthly penalty for number of employees 250+?

A

£400

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67
Q

Less than 16 days in UK

A

Previously Resident: Automatically not resident

Not Previously Resident: Automatically not resident

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68
Q

16 days to 45 days in UK

A

Previously Resident: Resident if 4 UK ties (or more)

Not Previously Resident: Automatically not resident

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69
Q

46 days to 90 days in UK?

A

Previously Resident: Resident if 3 UK ties (or more)

Not Previously Resident: if 4 UK ties (or more)

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70
Q

91 days to 120 days in UK?

A

Previously Resident: Resident if 2 UK ties (or more)

Not Previously Resident: if 3 UK ties (or more)

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71
Q

121 days to 182 days in UK?

A

Previously Resident: Resident if 1 UK ties (or more)

Not Previously Resident: if 2 UK ties (or more)

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72
Q

183+ days in UK?

A

Automatically resident

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73
Q

Sufficient ties test (Family)

A

Family tie

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74
Q

Sufficient ties test (Accommodation)

A

Accommodation tie

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75
Q

Sufficient ties test (Work)

A

Substantive work in the UK (40 or more days at any time in the tax year)

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76
Q

Sufficient ties test (90 days)

A

Spent more than 90 days in the UK in either of the previous two tax years

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77
Q

Sufficient ties test (Country)

A

Spending more days in the UK than in any other country in the tax year. Tie only relevant to a person who is UK resident in any of three previous years

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78
Q

Automatic UK tests (183 days)

A

Spending 183 days or more in the UK during the tax year

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79
Q

Automatic UK tests (home)

A

Individual’s only home is in the UK

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80
Q

Automatic UK tests (working)

A

Working full-time in the UK for any period of at least 365 days

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81
Q

Automatic overseas tests (16 days)

A

UK resident in any of the previous three tax years and fewer than 16 days are spent in the UK

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82
Q

Automatic overseas tests (not UK resident)

A

Individual was not UK resident in any of the previous three tax years and fewer than 46 days are spent in the UK

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83
Q

Automatic overseas tests (working)

A

Individual is working full-time overseas with no significant breaks, with fewer than 91 days spent in the UK and fewer than 31 working days in the UK

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84
Q

When is inheritance tax due on CLTs?

A

30 April following end of tax year

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85
Q

When is inheritance tax due on death estate?

A

Six months from the end of the month of death, or on delivery of the estate accounts to HMRC if earlier

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86
Q

When is inheritance tax due on a gift?

A

Later of:
30 April

6 months from the end of the month in which the gift is made

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87
Q

When are payment on accounts not required for 2023-24?

A

If relevant amount in 2023/24 did not exceed £1000

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88
Q

Can taxpayers dispute a dtermination?

A

NO

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89
Q

An amendment?

A

Make an amendment within 12 months of the prescribed filing date

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90
Q

A compliance check?

A

Can initiate a compliance check within 12 months of the actual filing date

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91
Q

What taxes are relevant in a payment on account?

A

Income tax and Class 4 NIC

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92
Q

Penalty for late paid tax for balancing payment and CGT (on or before penalty date)?

A

0%

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93
Q

Self-assessment late-filing tax returns penalty (0-3 months)

A

£100

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94
Q

Self-assessment tax returns late-filing penalty (3-6 months)

A

£100

£10 per day (max 90 days)

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95
Q

Self-assessment tax returns late-filing penalty (6-12 months)

A

£100

£10 per day (max 90 days)

Greater of 5% of unpaid tax and £300

96
Q

Self-assessment tax returns late-filing penalty (12+ months)

A

£100

£10 per day (max 90 days)

Greater of: 5% of unpaid tax and £300

Greater of: % on unpaid tax conduct based and £300

97
Q

Alternative filing deadline to 31 January 2025?

A

Three months from the issue of a notice to file.

98
Q

Calculate payment on account for 31 July 2024?

A

(Class 4 NIC + Income tax liability) / 2

99
Q

Calculate balancing payment?

A

(Class 4 NIC + Income tax liability + Class 2 NIC + capital gains) - ((Class 4 NIC + Income tax liability) / 2)

100
Q

Notification of a compliance check?

A

Within 12 months of the actual filing date

101
Q

When does the £5000 exemption happen?

A

Gift given by a parent on the occasion of a wedding

102
Q

When does the £2500 exemption happen?

A

Gift given by a linear ancestor on the occasion of a wedding

103
Q

When does the £1000 exemption happen?

A

Gift given by any other person on the occasion of a wedding

104
Q

Who is responsible for paying additional inheritance tax arising from the gift made to the trust as a result of Percy’s death?

A

The trustees

105
Q

When is inheritance tax due on a gift when someone is dead?

A

By 6 months from end of month of death. Tax is payable by trustees

106
Q

Available NRB on death estate calculation?

A

£325000 + Any transferred NRB from partner - lifetime transfers in seven years before death

107
Q

Retention period for employees?

A

31 January 2026

108
Q

Retention period for self-employed and sole traders?

A

31 January 2030

109
Q

Settlement of VAT liability of annual accounting period (nine monthly)

A

Nine monthly payments on account (each being 10% VAT due for the previous 12 months)

Starting at the end of 4th month of current annual accounting period.

110
Q

Settlement of VAT liability of annual accounting period (balancing payment)

A

A balancing payment of the remaining sum, two months after the end of the current annual accounting period.

111
Q

When is output VAT available in cash accounting?

A

Not payable until the customers have settled their invoices.

112
Q

When is input VAT recoverable in cash accounting?

A

Until suppliers have been paid

113
Q

Flat rate scheme association?

A

Annual accounting scheme, not cash accounting scheme

114
Q

When do VAT invoices only need to be issued in flat rate scheme?

A

To customers who are VAT registered

115
Q

Relief and flat rate scheme?

A

No relief is given for input VAT suffered

116
Q

Can VAT be claimed on a car where there’s been private use?

A

NO

117
Q

From what date was Richard required to be compulsorily registered for VAT?

A

First day of the second month

118
Q

From what date was Richard required to notify HMRC?

A

Within 30 days

119
Q

Flat rate scheme?

A

(Sales - exempt) * flat rate %

120
Q

Can input VAT be claimed when using flat rate scheme?

A

No

121
Q

What if a partnership leaves flat rate scheme, would it be unable to rejoin for at least 12 months?

A

Yes

122
Q

Irrecoverable input VAT (new car leased)

A

New car is leased and also used partly for private purposes, 50% of the input VAT on the lease charge is irrecoverable

123
Q

Irrecoverable input VAT (value of goods or services)

A

Value of goods or services withdrawn from the business for non-business purposes unless output VAT is accounted for on the private use

124
Q

Irrecoverable input VAT (entertaining)

A

Entertaining, unless for staff or overseas customers

125
Q

Goods acquired less than four years? (Input VAT claim)

A

Input VAT can be claimed

126
Q

Services acquired less than six months? (Input VAT claim)

A

Input VAT can be claimed

127
Q

Scale charge (input or output VAT)?

A

Output VAT

128
Q

Can input VAT be reclaimed on a second hand container lorry?

A

YES

129
Q

What is a substantial trader?

A

VAT liability less than 12 months exceeds £2.3 million

130
Q

If VAT liability for quarter is £680000 and payment on account is £250000 for quarter ended 31 December 2023? (30 November 2023)

A

Payment on account of £250000

131
Q

If VAT liability for quarter is £680000 and payment on account is £250000 for quarter ended 31 December 2023? (31 December 2023)

A

Payment on account of £250000

132
Q

If VAT liability for quarter is £680000 and payment on account is £250000 for quarter ended 31 December 2023? (31 January 2024)

A

Balancing payment £680000 - £250000 - £250000 = £180000 with submission of VAT quarter

133
Q

What quarter can impaired VAT be reclaimed if due date is 10 October 2023?

A

30 June 2024, as this is after 6 months outstanding

134
Q

Time limit to reclaim overpaid VAT?

A

Four years

135
Q

Tax point determines what?

A

The VAT period in which output tax must be accounted for and credit for input tax will be allowed

136
Q

VAT invoices and flat rate scheme (issuing invoices)?

A

Businesses using the scheme must issue VAT invoices to their VAT registered customers

137
Q

Businessses using flat rate scheme and input tax?

A

They cannot reclaim any input VAT suffered

138
Q

Cash accounting scheme advantage on credit sales?

A

Output VAT on 10% of credit sales will be accounted for up to 1 month later than at present

139
Q

Notification of deregistration if ceases trading on 31 March 2024?

A

30 April 2024

140
Q

Actual deregistration if ceases trading on 31 March 2024?

A

31 March 2024

141
Q

If business is sold as a going concern (advantage)

A

No output VAT will be payable in respect of the sale of the business

142
Q

Is a penalty point for VAT incurred on filing or payment?

A

Filing

143
Q

What impairment loss is included in input VAT?

A

If it’s more than 6 months

144
Q

When are fees included in input VAT?

A

If it is 6 or less months

145
Q

When are goods included in input VAT?

A

If it 4 years or less

146
Q

Can repairing the exterior of the company’s office building be recovered input VAT?

A

Yes

147
Q

Can extending the office building to create a new reception area be recovered input VAT?

A

Yes

148
Q

VAT on cessation for non-current assets?

A

What is still owned (excluding cars)

149
Q

Annual accounting scheme advantage (administration)?

A

Reduced administration

150
Q

Annual accounting scheme advantage (payments on account)?

A

Payments on account based on previous year’s VAT liability will improve budgeting and cash flow if business is expanding

151
Q

Postponed accounting effect?

A

Input and output VAT on imports are the same

152
Q

An individual appealing against a penalty for late registration for VAT?

A

Must appeal directly to the tribunal

153
Q

Is business asset disposal relief and gift holdover relief available on disposal of shares?

A

NO

154
Q

Who can apply for cash accounting scheme?

A

Turnover exclusive of VAT does not exceed £1.35 million

155
Q

When does cash accounting scheme cease?

A

When turnover exceeds £1.6 million

156
Q

When can trader join cash accounting scheme?

A

A trader can join only if all returns and VAT payments are up-to-date

157
Q

When can trader join annual accounting scheme?

A

Turnover exclusive of VAT does not exceed £1.35 million

158
Q

Requirements for annual accounting scheme?

A

Up to date with VAT payments

159
Q

Returns in annual accounting?

A

Only 1 return per year but POA throughout the year

160
Q

When does POA for annual accounting start?

A

End of fourth month of the year. Done monthly after that

161
Q

When are balance and return due for annual accounting?

A

Two months after year end

162
Q

When can flat rate scheme be used?

A

If VAT exclusive turnover for next 12 months not expected to exceed £150000

163
Q

Input VAT and flat rate scheme?

A

Is not recovered

164
Q

When must flat rate scheme be left?

A

If VAT inclusive turnover for next 12 months exceeds £230000

165
Q

Advantage of annual accounting (return)

A

Only one VAT return each year

166
Q

Advantage of annual accounting (cash flow)

A

Manage cash flow more accurately

167
Q

Advantage of annual accounting (quarterly)

A

Avoids quarterly calculations for input tax recovery

168
Q

Disadvantage of annual accounting (monitor)

A

Monitor future taxable supplies to ensure turnover is not exceeded

169
Q

Disadvantage of annual accounting (previous year)

A

Payments based on previous year’s turnover may not reflect current year turnover

170
Q

Advantage of cash accounting scheme (cash flow)

A

It improves cash flow where customers are late payers

171
Q

Advantage of cash accounting scheme (automatic)

A

It gives automatic relief for impairment losses

172
Q

Advantage of cash accounting scheme (annual)

A

Can be used along with the annual accounting scheme

173
Q

Advantage of flat rate scheme (detailed records)

A

Eliminates the need to keep detailed records of purchases and sales

174
Q

Disadvantage of flat rate scheme (input VAT)

A

Not be beneficial for businesses with large amounts of input VAT to recover

175
Q

When can company leave quarterly scheme?

A

VAT liabiltiy falls below £1.8 million

176
Q

Can annual accounting scheme and cash accounting scheme be used together?

A

Yes

177
Q

if date of deposit was before the basic tax point (date of despatch). What is the actual tax point?

A

Actual tax point is the date the deposit was paid

178
Q

As an invoice was issued within 14 days of the basic tax point. What is the actual tax point?

A

The date of the invoice

179
Q

When default interest not charged?

A

Where voluntary disclosure can be made by entering the underpayment on the next VAT return

180
Q

When must BADR relief be claimed?

A

By 31 January 2026

181
Q

When are chattels exempt from CGT?

A

If they are wasting assets

182
Q

Spouse exemption in an estate?

A

Is deducted to get the chargeable estate

183
Q

Does goodwill qualify for rollover relief?

A

NO (for companies)

184
Q

Notice of chargeability to capital gains tax (date)?

A

5 October 2024

185
Q

Business asset disposal relief lifetime limit?

A

£1 million

186
Q

What is deducted in nil rate band at Stage 1?

A

CLTs not PETs

187
Q

What is deducted in nil rate band at Stage 2?

A

CLTs and PETs

188
Q

When is RNRB used?

A

Died on or after 6 April 2017

Passes to direct descendants

189
Q

Annual allowance?

A

£40000

190
Q

Income limit for annual allowances?

A

£240000

191
Q

What percentage of pension funds can be withdrawn as a tax-free lump sum?

A

25%

192
Q

What percentage of pension funds if excess value is taken as a lump sum?

A

55%

193
Q

Sale of residential property due date?

A

60 days

194
Q

Is indexation included in consideration received table?

A

NO, is done separately ina share pool

195
Q

Future VAT liability exceeding £85000 (registeration and notification)

A

Register: 1st day of same month

Notification: End of first month

196
Q

WDA on a disposed asset in capital allowances?

A

No WDA is claimed

197
Q

Relief on impairment losses in VAT is determined by?

A

The payment due date

198
Q

When property owned more than six years?

A

Use market value

199
Q

In asset and subsequent working. should I use figure when purchased or when first provided?

A

First provided

200
Q

File VAT return (annual accounting scheme)

A

Return due 2 months after the end of the accounting period

201
Q

Pay VAT liability (annual accounting scheme)

A

Payment due within 2 months of month 12

202
Q

Payments on account for annual accounting scheme?

A

10% of previous year VAT liability. Done from months 4 to 12

203
Q

Insurance on property income (cash basis vs accruals)?

A

Cash basis: Whole

Accruals basis: TIme-apportioned

204
Q

When is payment on account not required?

A

When relevant amount is less than £1000

205
Q

SLA when sold (WDA or no WDA)?

A

No WDA

206
Q

When there’s cessation (WDA or no WDA)?

A

No WDA

207
Q

Are earnings class 1 or class 1a?

A

Class 1

208
Q

If question says trader has PAID a premium for granting a short lease?

A

Use the division working when put into the computation (lease premiums)

209
Q

How does director’s renumeration interact with trading profit?

A

It is deducted

210
Q

Where are parternship profits included in the computation?

A

After qualifying interest but before personal allowance

211
Q

What occupational contribution is deducted from income?

A

The one made by Percy, not the company

212
Q

Carry forward relief (for individual)?

A

Only available against trading income

213
Q

When will bonus be treated as received?

A

Earlier of date of payment or date of entitlement

214
Q

Time relief for terminal loss relief?

A

5 April 2028

215
Q

What happens with exempt employment income?

A

Not added to the salary

216
Q

Time limit for claims against total income?

A

31 January 2026

217
Q

When is there NIC on a car?

A

For company, not the individual

218
Q

What NIC does a partner have to pay?

A

Class 4 and class 2

219
Q

When is fuel benefit charged?

A

When an employer provides free or subsidised fuel for private use of a company car. The amount is £27800

220
Q

Are dividends relevant in corporation tax?

A

NO

221
Q

Redecorating a room in MD’s house (excluded or included in input VAT?

A

Excluded

222
Q

When there is some private use on a leased car (VAT calculation)

A

Cost * private use * 20%

223
Q

When cost of original shareholding is passed on to new shareholding in a gift (in a chargeable gain)?

A

Original cost * (gift shares/Original shares)

224
Q

When loss relief says as soon as possible?

A

Relief for the early years

225
Q

When does interest for corporation tax run from (the 6.5% calculation)?

A

1 October 2024

226
Q

When business is run as a sole trader and renumeration?

A

There are no gross director’s renumerations

227
Q

Balancing payment that’s over six months late and where the amount is £2600?

A

1 month late: £2600 * 5%

6 month late: £2600 * 5%

228
Q

Can trading incoem loss be used against all income when brought forward (for a company)?

A

YES

229
Q

The choices in a loss relief for a company?

A

Carry back
Current year
Carry forward

230
Q

Formula for gift holdover?

A

APOC

231
Q

What does a new delviery van qualify for in capital allowances?

A

AIA

232
Q

Leasehold premium division (added or subtracted in computation)?

A

Subtracted

233
Q

What is the penalty for when four penalty points are reached in VAT filing penalties?

A

£200

234
Q

How long must VAT invoices be retained for?

A

Six years

235
Q

When is interest for income tax start date?

A

31 January 2025

TX Accumulated Knowledge (35 decks)

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