Chapters 8-10

Question 1

How do basic rate tax payers get relief for gift-aid?

Answer 1

At source

Question 2

What must a person have to qualify for gift aid?

Answer 2

Sufficient income and gains to cover the tax treated as deducted from source (included if they have some income but it is covered by allowances etc so they dont pay any tax).

Question 3

When does the donation not qualify for gift aid?

Answer 3

If any benefit received in relation to the gift exceeds certain prescribed limits. (ITA 2007 S.418)

Question 4

What did the HMRC Vs osborne case show?

Answer 4

If paying a subscription (not to a charity itself) and it is then donated to charity. This does NOT qualify for giftaid. Subscriptions TO charities are fine unless there is any personal use.

Question 5

When must elections to carry back gift aid be made?

Answer 5

No later than 31 Jan in the year WHICH THE DONATION WAS MADE (31 Jan 2023 for 22/23).

Question 6

Gifts of QUOTED stock and land/buildings to a registered charity?

Answer 6

Deductible at MV (cost used if shares bought within 4 years prior to gift and basically in a dodgey way/an attempt to get a higher tax deduction).

Question 7

Why is the MCA tax reducer set off last?

Answer 7

So that the amount which is unused can be transferred to the other spouse. Must make a claim by 4 yrs after the end of the tax yr.

Question 8

What can an EIS/SEIS/SITR/VCT tax reducers not do?

Answer 8

Create a repayment. BUT they could create a repayment of PAYE (deduct the PAYE after the tax reducers).

Question 9

EIS reducer?

Answer 9

30% lower of:
Amount invested
1 million

Question 10

What is the EIS reducer for knowledge intensive companies?

Answer 10

upped to 2million

Question 11

SEIS tax reducer?

Answer 11

50% lower of
amount invested
100k

Question 12

SITR reducer?

Answer 12

30% lower of
amount invested
1 million

Question 13

VCT reducer?

Answer 13

30% lower of
amount invested
200k

Question 14

What can claims be made to do for MCA?

Answer 14

Allocate the full minimum MCA (needs both partners to elect) or half the minimum MCA (does not need both partners to elect) to wife/lower paid earner at the beginning of the year. These claims need to be made before the start of the tax year to be valid. Unused MCA can be transferred at the end of the tax year and must make a claim within 4 years of the end of the tax year.

Question 15

Can scottish tax payers still get MA at the 21% rate?

Answer 15

YES

Question 16

Giftaid for scottish tax payers?

Answer 16

Still the gross up of 20%. Basic, intermediate and higher rate limits are extended but not the starter rate band.

Question 17

A UK resident will be a scottish tax payer in the year if…

Answer 17

close connection to scotland OR where no close connection, more days in scotland than anywhere else in UK.