Chapter 10 - Taxation

Question 1

First overseas residency test?

Answer 1

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

Question 2

Second overseas residency test?

Answer 2

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

Question 3

Third overseas residency test?

Answer 3

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

Question 4

First UK residency test?

Answer 4

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

Question 5

Second UK residency test?

Answer 5

• 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

Question 6

Third UK residency test?

Answer 6

• They work full time in the UK

Question 7

• UK resident and domiciled tax?

Answer 7

• Taxable on their worldwide income as it arises:
• Does not have to be remitted to the UK to be taxable

Question 8

• UK resident but non-UK domiciled tax?

Answer 8

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

Question 9

Overseas resident tax?

Answer 9

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

Question 10

3 types of taxable income

Answer 10

Non-savings income
Savings income
Dividend Income

Question 11

Personal Income Tax Allowance

Answer 11

12,570

Question 12

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

Answer 12

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

Question 13

Basic Rate of tax threshold?

Answer 13

12570 - 37,700

Question 14

Basic Rate of tax ?

Answer 14

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

Question 15

Higher Rate of tax threshold?

Answer 15

37,701 - 150,000

Question 16

Higher Rate of tax?

Answer 16

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

Question 17

Additional Rate of tax threshold?

Answer 17

> 150,000

Question 18

Additional Rate of tax?

Answer 18

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

Question 19

How many years of NI for basic full pension?

Answer 19

35 years (lol)

Question 20

Who is responsible in a trust for settling the tax?

Answer 20

Trustee

Question 21

How is the first 1k of a trust taxed?

Answer 21

• 20% for savings and property income
• 8.75% for dividends

Question 22

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

Answer 22

• 45% for savings and property income
• 39.35% for dividends

Question 23

Tax on a bare trust?

Answer 23

• Taxed at the beneficiaries’ marginal rate

Question 24

CGT Tax Free Allowance?

Answer 24

£12,300

Question 25

Basic CGT?

Answer 25

10%

Question 26

Additional CGT?

Answer 26

20%

Question 27

UK Domiciled Individuals (IHT/CGT)

Answer 27

Worldwide Assets/Gains

Question 28

Non-UK Domiciled Individuals (IHT)

Answer 28

UK Assets ONLY

Question 29

Difference in a PET and CLT?

Answer 29

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

Question 30

Name two IHT Nil rate bands

Answer 30

Main NRB, and Main Residence NRB

Question 31

Main NRB?

Answer 31

325k

Question 32

Main Residence NRB?

Answer 32

175k

Question 33

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

Answer 33

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

Question 34

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

Answer 34

20%

Question 35

Which funds dont pay tax on income or gains?

Answer 35

REITS pay no tax on income or gains

Question 36

Non-savings income includes?

Answer 36

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

Question 37

Savings income?

Answer 37

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

Question 38

Dividend Income

Answer 38

As expected

Question 39

Are saving and non-saving income rates the same?

Answer 39

Yes, 20, 40 and 45

Question 40

Dividend Rates?

Answer 40

8.75, 33.75, and 39.35

Question 41

Tax free saving income allowances?

Answer 41

£1000, £500, and £0

Question 42

What is the dividend allowance for different bands?

Answer 42

£2000 for all bands

Question 43

Who is responsible for settling tax on a trust?

Answer 43

Trustee

Question 44

Non-UK Domiciled Individuals (CGT)

Answer 44

No liability on assets in UK or elsewhere

Question 45

CGT Exemptions List

Answer 45

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

Question 46

How do losses from previous tax years affect CGT?

Answer 46

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

Question 47

What is the IHT rate?

Answer 47

40%

Question 48

Do funds pay capital gains tax?

Answer 48

No, only 20% on income

Question 49

When is SDRT and SD paid?

Answer 49

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

Question 50

When is stamp duty specifically paid/

Answer 50

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

Question 51

Stamp duty reserve tax (SDRT) liabilities?

Answer 51

• UK registered shares
• Options on shares
• UK convertible loan stock

Question 52

SDRT Exemptions?

Answer 52

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

Question 53

SDLT Rates?

Answer 53

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

Question 54

SDLT on first time buyers?

Answer 54

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

Question 55

How is corp tax paid?

Answer 55

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