Chapter 4 - 2.2 - Renumeration

Question 1

Which payments to staff are allowable?

Answer 1

Salaries, bonuses, redundancy payments and the cost of providing benefits

Question 2

What happens if earnings are not paid within nine months of the year’s end?

Answer 2

They are then deductible in the period in which they are paid

Question 3

How are employer’s contributions to pension schemes unique?

Answer 3

They are allowed when paid, rather than on the normal accruals basis

Question 4

When is training expenditure for employees allowable?

Answer 4

It is allowable provided that the training is aimed at improving the skills needed in the business

Question 5

When are training costs allowable for a sole trader?

Answer 5

If they are maintaining existing skills

Question 6

What is an appropriation?

Answer 6

A withdrawal of funds from a business’s profit. These are disallowable as expenses

Question 7

What are common examples of appropriations?

Answer 7

• The business owner’s salary
• Drawings made by a sole trader / partner

Question 8

How are unreasonable payments to family member’s classified?

Answer 8

As appropriations of profit and therefore the excess is disallowed