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R03 - Chapter 1 > Chapter 10 > Flashcards

Chapter 10 Flashcards

1
Q

what tax wrappers are avliable

A

pension plans, isas, oiecs, life assurance

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2
Q

at what age is the limit to cotributing to the pensikon

A

75

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3
Q

employees/se;f employed can contribute up to

A

100,000

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4
Q

what is the life time allowance

A

1,073,100 - any excess takes charges

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5
Q

what is a crystalatisation

A

test against the lta

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6
Q

how much can you take lta

A

25% tax free - other income taken down from lta will be taken as income tax

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7
Q

how is a crystalised beneifittaxed

A

tacabkle - cklassied as non savigs income - cant use any allowances against pension incoem irrepective of how yu take it

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8
Q

what is death classed as

A

crystalised event

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9
Q

if a pension is drawing out 32,000 for first time what is the rate

A

32,000 x o.25 = tax free
32,000x0.75 will be taxed
24,000 = 75% - which will be taxed at 40% = 9,600

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10
Q

what is the cash isa accesability

A

from 16

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11
Q

are isas instat access

A

yes

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12
Q

What is the main benefit of using a tax wrapper?

A

Beneficial tax treatment

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13
Q

what is the stocks and shares isa

A

underlying asset - under a Unit end Trust

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14
Q

what uis a innoative isa

A

treated as a atsocks and shares isa - but avaliable from 18

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15
Q

is a lifetime isa part of the 20,000 annual limit

A

yes

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16
Q

when is the last age you can have one lisa

A

18-40

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17
Q

help to buy isa

A

you can still top u to it if yoy had it before november 2019 - maxium scubscripton of 12,000 and a it was a contract - used for first home

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18
Q

How many years cxan you carry forward a pension

A

3 years plus teh current tax year

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19
Q

what is the retirement date where you can claim beneifits to your pension

A

55

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20
Q

can a employers pensions still be apid whuilst working

A

yes

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21
Q

what are structured products usually linked to

A

the FTSE 100

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22
Q

are income and gains exept from tax in an isa

A

yes

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23
Q

what ar ethe limitids of an isa

A

20,000

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24
Q

what is teh eligibility fr an isa

A

must be a uk residnet - 18 - not held jintly

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25
what if icnoem is reieved by a jisa - what haopens
anything more than a 100 gross is net as taxed as parents income
26
what types of isas are tehre
junior, lifetime, innoative, stcoks and shares, cash
27
what can stocks and shares invest in
they may invest in oeics, Uk UCITs, aim listed, sec urity shares, coporate bonds - cash - lief assurance policeies - shares listed on recofnised platfiorms
28
what is a cash isa invetsed in
banks or buidling societies
29
what investment opportunties does a jisa have
same as a normal isa
30
what is an innoative isa
- peer ro peer lending, sharia compliant connecting lenders with borrowers
31
what replaced teh helped to buy isa
the LISA
32
when cant you open a LISA
when youre 40 or odler
33
what happens when a spouse dies and they have an isa
the isa is inhertied by the oteh rspouse, they can conntribute without it going into tehir allowances
34
who are isas suitabkle for
those who have used up their allowances or an ADR
35
when was a CTF abolished
2011 - replaced by the JISA
36
what is the tax treatment of inceom on an isa
receieved free of inocem and cgt - more than £ 100 charged to the parent if held in a Jisa
37
what do OEICS and Unit trusts allow
they allow individuals to particpaite in a large portfolio of shaes
38
how can a uk colletcive be bought in
can be held in tax wrappers such as pensions and isas
39
what are the differnces between how Uk collectives are taxed and direct investments
unit trusts and OEICs are openended. Units or shares are issued when investors invest and liquidated taxation of dividends from OEICs and equity uni
40
where are offshiore collectives et up
with there is little to no tax - channel islands 0 luxembirg
41
who would be suitabkle for offshore collectives
non uk residents
42
how are reporting funs taxed
declares as income on self assesmnet - they must be applied to HMRC
43
how are equity distributions taxed
as dividend rates
44
how are interest distributiosn taxed
as savings - from 0% 20 40 45
45
is there a personao allowance on interest distrinutions
yes
46
ultimatley how are they taxed - reporting funds
taxed the same as uk collectices
47
what about a non reportiung fund do they have stauts
no - the do not have reporting status
48
how are non reporting funds taxed
Income is not taxed as it arises, only on disposal of units/shares basiclaly when they are sold
49
what happens if one dies and they hold an non reporting fund
calcualted off cgt principles
50
as non reporting funds have income within it how is this taxed
will constitute towards part of the gain
51
as it is opart of the gain what is the rate liable to
to income tax it is charged at the 20% basic rate, the 40% higher rate or the 45% additional rate.
52
what is the differences between non reporting funds and reporting funds
non reporting funds have some advantages
53
what are the advantages iwth on reporting funds
Income can grow faster in a low-tax environment. UK investors can defer paying tax on income and profits made offshore until they bring them back to the UK. Offshore investments are exempt from UK inheritance tax (IHT) for non-UK domiciled investors.
54
what is teh tax treatment of an offshore fund
dividends it receives will usually be subject to a non-reclaimable withholding tax Fixed-interest funds are usually more tax efficient for UK-resident investors because these funds choose investments, such as Eurobonds and exempt gilts, which pay income gross. * Some jurisdictions levy a small amount of tax on offshore funds. .
55
regarding lifetime assurance policies how is the icnome taxed
well - thye do not produce income so wont be taxed, however, if it is in a trust drawdown then yes
56
if a chargabel event occurs what is it declared as
a chargabele gain
57
if a policy is subject to a trust who is taxed
teh settlor
58
what if the settlor dies who pays the taz
the trustee
59
what is the taxation on a discretionary
45%
60

R03 - Chapter 1 (13 decks)

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