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IMC Module 1 > Chapter 10 - Taxation > Flashcards

Chapter 10 - Taxation Flashcards

1
Q

First overseas residency test?

A

Present in the UK for fewer than 16 days in the current fiscal year

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2
Q

Second overseas residency test?

A

Not present in the UK during the last three fiscal year, and
Present in the UK for fewer than 46 days in the current fiscal year

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3
Q

Third overseas residency test?

A
  • Work full time overseas, and
  • Spend fewer than 91 days in the UK, and
  • No more than 30 days spent working in the UK
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4
Q

First UK residency test?

A
  • Present in the UK for at least 183 days in a fiscal year
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5
Q

Second UK residency test?

A
  • Their only home (or main home) is in the UK
  • Available for use for 91 days or more, and
  • Used for at least 30 days
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6
Q

Third UK residency test?

A
  • They work full time in the UK
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7
Q
  • UK resident and domiciled tax?
A
  • Taxable on their worldwide income as it arises:
  • Does not have to be remitted to the UK to be taxable
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8
Q
  • UK resident but non-UK domiciled tax?
A

UK income
* Taxable as it arises

  • Foreign income
    < £2,000, automatic remittance basis
    ≥ £2,000, choose to pay on either arising basis, or remittance basis
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9
Q

Overseas resident tax?

A
  • Taxable on their UK income as it arises
  • Overseas income is not subject to UK tax
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10
Q

3 types of taxable income

A

Non-savings income
Savings income
Dividend Income

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11
Q

Personal Income Tax Allowance

A

12,570

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12
Q

If someone earns 100k+, how is their allowance affected?

A

£1 reduction for every £2 earned over 100k, goes to 0 at 125,140

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13
Q

Basic Rate of tax threshold?

A

12570 - 37,700

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14
Q

Basic Rate of tax ?

A

20% for non-savings income and savings income, 8.75% for Dividend

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15
Q

Higher Rate of tax threshold?

A

37,701 - 150,000

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16
Q

Higher Rate of tax?

A

40% for non-savings income and 45% for savings income, 33.75% for Dividend

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17
Q

Additional Rate of tax threshold?

A

> 150,000

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18
Q

Additional Rate of tax?

A

45% for non-savings income and savings income, 39.35% for Dividend

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19
Q

How many years of NI for basic full pension?

A

35 years (lol)

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20
Q

Who is responsible in a trust for settling the tax?

A

Trustee

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21
Q

How is the first 1k of a trust taxed?

A
  • 20% for savings and property income
  • 8.75% for dividends
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22
Q

How is the post-1k of a trust taxed?

A
  • 45% for savings and property income
  • 39.35% for dividends
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23
Q

Tax on a bare trust?

A
  • Taxed at the beneficiaries’ marginal rate
24
Q

CGT Tax Free Allowance?

25
Q

Basic CGT?

26
Q

Additional CGT?

27
Q

UK Domiciled Individuals (IHT/CGT)

A

Worldwide Assets/Gains

28
Q

Non-UK Domiciled Individuals (IHT)

A

UK Assets ONLY

29
Q

Difference in a PET and CLT?

A

PET: Not taxed but becomes taxable if dead <7 years
CLT: Taxed Immediately and also within 7 years if dead

30
Q

Name two IHT Nil rate bands

A

Main NRB, and Main Residence NRB

31
Q

Main NRB?

32
Q

Main Residence NRB?

33
Q

Charity Relief Inheritance Tax if >10% of estate is left to charity?

A

36% (10% reduction on the standard 40%)

34
Q

On average, how much Corp. Tax do funds pay?

35
Q

Which funds dont pay tax on income or gains?

A

REITS pay no tax on income or gains

36
Q

Non-savings income includes?

A

Employment/Self Employment, Pension, and Social Security Benefits, Property Business (Buy to let etc)

37
Q

Savings income?

A

Interest from banks, bond interest, and debentures, income portion of life annuity

38
Q

Dividend Income

A

As expected

39
Q

Are saving and non-saving income rates the same?

A

Yes, 20, 40 and 45

40
Q

Dividend Rates?

A

8.75, 33.75, and 39.35

41
Q

Tax free saving income allowances?

A

£1000, £500, and £0

42
Q

What is the dividend allowance for different bands?

A

£2000 for all bands

43
Q

Who is responsible for settling tax on a trust?

44
Q

Non-UK Domiciled Individuals (CGT)

A

No liability on assets in UK or elsewhere

45
Q

CGT Exemptions List

A

Primary residence
Betting and lottery wins
Currency bought for holidays
National savings certificates and premium bonds
Private motor cars
Life assurance policies
Gilts and qualifying bonds
Gifts to charities

46
Q

How do losses from previous tax years affect CGT?

A

Reduce gains NOT covered by annual exemption, can be carried forward indefinitely

47
Q

What is the IHT rate?

48
Q

Do funds pay capital gains tax?

A

No, only 20% on income

49
Q

When is SDRT and SD paid?

A

Paid by the buyer on paperless transactions at a rate of 0.5%

50
Q

When is stamp duty specifically paid/

A

Certificated shares with a sale price of more than £1,000

51
Q

Stamp duty reserve tax (SDRT) liabilities?

A
  • UK registered shares
  • Options on shares
  • UK convertible loan stock
52
Q

SDRT Exemptions?

A
  • AIM/NEX shares
  • Gilts
  • Corporate bonds (unless convertible)
  • Overseas securities
53
Q

SDLT Rates?

A

0-250k = 0
250,001-925k = 5%
925,001-1.5m = 10%
>1.5m = 12%

54
Q

SDLT on first time buyers?

A

0-425k = 0
425,001-625k = 5%
625k+ = Usual

55
Q

How is corp tax paid?

A

9months+1 day after accounting year end, large companies (£1.5m+ profits) is quarterly

IMC Module 1 (10 decks)

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