Assessment MCQ Corrections

Question 1

What type of resolution is required for a long-term service contract?

Answer 1

Ordinary

Question 2

What is the fastest way to grant a long-term service contract?

Answer 2

Written resolution because you can’t shorten the in person version because a memorandum needs to be available for inspection not less than 15 days ending with the date of the meeting

Question 3

What type of resolution is required to approve a loan to a director?

Answer 3

Ordinary

Question 4

What must be made available for inspection before approving a loan to a director?

Answer 4

A memorandum setting out the nature, amount and purpose of the loan

Question 5

What type of resolution is required to remove a director?

Answer 5

Ordinary

Question 6

Can an incorporated company be considered a quasi-partnership regarding dismissal of a director and minority shareholder for an unfair prejudice claim?

Answer 6

Yes

Question 7

What is a s 303 request?

Answer 7

A request the shareholders give to the directors to force them to call a GM

Question 8

What is the deadline to call a general meeting after the shareholders serve a s303 notice?

Answer 8

21 days

Question 9

What type of resolution is required to give directors authority to allot new shares?

Answer 9

Ordinary

Question 10

What type of resolution is required to disapply pre-emption rights?

Answer 10

Special

Question 11

What type of resolution is required to amend the articles?

Answer 11

Special

Question 12

Is there a limit on authorised share capital for a company incorporated under CA 2006?

Answer 12

No

Question 13

When do you not need to disapply pre

Answer 13

If you’re happy for them to apply

If there are already special provisions in the articles

Question 14

What is the deadline for a company to pay its tax liability to HMRC?

Answer 14

9mo and 1 day

Question 15

What capital allowance deductions are allowed to be deducted from income for corporation tax?

Answer 15

Plant and machinery 18% deduction on value each year

Plant and machinery 100% on new/refurbished up to 1million for any qualifying purchase each year

There are other deductions available like renovations etc, but they are ‘beyond the scope of materials’ and not considered in the MCQs

Question 16

Does interest paid on loans count as deductible expenditure for corporation tax income?

Answer 16

Yes

Question 17

Does renting property count as deductible expenditure for income tax purposes?

Answer 17

Yes

Question 18

Do renovations count as deductible income expenditure?

Answer 18

No

Question 19

What is reduced when applying roll-over relief? What is the gain ‘rolled into”?

Answer 19

The acquisition cost of the new asset it reduced by the amount of the gain

Question 20

What is the difference between the full-expensing capital allowance and the annual capital allowance?

Answer 20

Full expensing is a special allowance applying between 1 April 2023 and 31 March 2026 that allows 100% expenditure on plant and machinery to be deducted WITHOUT A CAP

The only difference from the normal annual expenditure allowance is that annual expenditure is capped at 1 million and the full-expensing is basically a temporary economic boost attempt in place with no cap

Question 21

In which business models are participants not liable for debts and liabilities of the business?

Answer 21

Companies

LLPs

Question 22

What is double taxation of profits in context of a company?

Answer 22

The company pays corporation tax on its profits before the payment of dividends to its shareholders. The individual shareholders who receive the dividends will pay income tax on the amount of the dividend.

Question 23

What individual taxes do partners pay out of their share from the partnership?

Answer 23

Both income and CGT

Question 24

When you list a parent company, does it also list the subsidiaries?

Answer 24

No

Question 25

What types of companies can offer shares to the public?

Answer 25

All public Doesn't have to be listed

Question 26

When converting to a PLC when can you commence trading as a PLC?

Answer 26

Cert of incorporation Trading certificate issued

Question 27

If you have a deal to pay for shares over time and the company goes under, is your liability limited to the shares you've already paid for, or includes the ones you planned to pay for?

Answer 27

Includes the ones you planned to pay for

Question 28

How can limited liability of a company be overridden?

Answer 28

Debtors can require a guarantee from the shareholders to incur their liabilty

Question 29

Under default, how many partners need to agree to introduce a new partner?

Answer 29

All of them -- unanimity

Question 30

How can a partner be removed?

Answer 30

Unanimous consent

Question 31

What liability to partners have?

Answer 31

Joint liability All on the hook for the whole thing

Question 32

How can members enforce articles?

Answer 32

Only through the company

Question 33

What is the modern status of the memorandum?

Answer 33

The memorandum has no constitutional significance but it is required to be filed on incorporation. It simply amounts to a declaration on the part of the company’s subscribers that they wish to form a company and agree to become members of that company.

Question 34

When does a company change of name become effective?

Answer 34

When the new certificate of incorporation is issued

Question 35

Do you need to file the MA when incorporating?

Answer 35

No, they are automatically applied

Question 35

What threshold of members need to vote in favour to pass a special resolution by written procedure?

Answer 35

75%

Question 36

What threshold is required to consent to a short notice meeting?

Answer 36

OVER 90%

Question 37

Do you need to register loan agreements with COMPANIES HOUSE?

Answer 37

No

Question 38

Can directors appoint a new director?

Answer 38

Yes, by ordinary resolution

Question 39

Do you have to tell companies house about a new director?

Answer 39

Yes, and within 14 days

Question 40

To whom do directors owe duties?

Answer 40

The company

Question 41

For a long term service contract, how long does it have to be?

Answer 41

Over 2y, 2y and 1 day

Question 42

What % of shareholders are needed to require a general meeting?

Answer 42

5%

Question 43

Which of the following is the most common remedy that the court will order in a claim for unfair prejudice?

Answer 43

An order that the company or the other shareholders purchase the petitioner’s shares.

Question 44

In which one of the following circumstances is a stock transfer form required to transfer the shares to the new shareholder?

Answer 44

When an existing shareholder of the company gifts their shares to a family member during their life.

Question 45

What type of resolution is required to allot new shares?

Answer 45

Ordinary

Question 46

What kind of resolution is required to disapply pre-emption rights?

Answer 46

Special

Question 47

In what document are the terms of redeemable shares set out in?

Answer 47

The articles

Question 48

Can you advise on the merits of shares under the sale of body corporate exemption?

Answer 48

Yes

Question 49

When determining which court should hear a case, is VAT included in the value?

Answer 49

Yes

Question 50

What is the statement of truth for a director signing on behalf of a company

Answer 50

The Claimant believes that the facts stated in these particulars of claim are true. The Claimant understands that proceedings for contempt of court maybe brought against anyone who makes, or causes to be made, a false statement in a document verified by a statement of truth without an honest belief in its truth. I am duly authorised by the Claimant to sign this statement.

Question 51

Can you apply for a judgement in default if you did not comply with the pre-action protocol?

Answer 51

Yes

Question 52

When considering whether to grant extensions, what will the court look at?

Answer 52

Overriding objective Just and proportionate

Question 53

Who is mostly responsible for costs arising from amendments?

Answer 53

The person who required the amendment

Question 54

What formalities are required for answering a request for further information?

Answer 54

The client’s response should be in writing, signed, dated and be verified by a statement of truth.

Question 55

Can you counterclaim against somebody other than the claimant?

Answer 55

Yes