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E Section Tax Adjusted Profit Flashcards

1
Q

Is personal allowance and AEA available for companies?

A

No

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2
Q

What happens with dividends from 51% group companies?

A

Are excluded from augmented profits. Therefore augmented profits and taxable total profits are the same

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3
Q

If there are no dividends in corporation tax liabiltiy? (Between £50000 and £250000)

A

26.5%

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4
Q

What % does an associate company have?

A

More than 50%

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5
Q

If an associate company is dormant?

A

It is not associated

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6
Q

Amounts not taxable as trading income (investment)

A

Investment income

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7
Q

Amounts not taxable as trading income (non-taxable)

A

Non=taxable income

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8
Q

Amounts not taxable as trading income (capital profits)

A

Capital profits on sale of assets

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9
Q

Capital expenditure and depreciation (allowable or disallowable)

A

Disallowable

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10
Q

Incidental costs incurred in raising share capital (allowable or disallowable)

A

Disallowable

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11
Q

Incidental costs in raising loan agreemnts and loan stocks (allowable or disallowable)

A

Allowable

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12
Q

Interest payable on loans taken out for non-trade purposes (allowable or disallowable)

A

Disallowable

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13
Q

Remuneration of a company director (allowable or disallowable)

A

Allowable

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14
Q

When is relief given for pre-trading expenditure?

A

Pre-trading revenue expenses incurred up to seven years before the start of trading provided that they would have been an allowable trading expense if incurred after the start of trading

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15
Q

Trade purpose loans?

A

Purchase plant and machinery
Provide working capital
Purchase office, warehouse or factory

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16
Q

Non-trade purpose loans?

A

Purchase property which is then let out AND acquire the share capital of another company

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17
Q

Are private use adjustments for capital allowances relevant for corporations?

A

FUCK NO

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18
Q

A short life asset election for corporation tax purposes?

A

Must be made within two years of the end of accounting period of purchase

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19
Q

When does 130% super deduction and 50% first year allowance for capital allowances available?

A

For a two-year period from 1 April 2021 to 31 March 2023

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20
Q

Property income accruals vs cash for corporations?

A

Always accruals

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21
Q

Loan interest payable treatment in corporation tax?

A

It is deducted from non-trade interest receivable

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22
Q

Adjusted trading profit before capital allowances (allocating profit)

A

Time apportion

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23
Q

Capital allowances (allocating profit)

A

Separate computations

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24
Q

Property business profit (allocating profit)

A

Time apportion

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25
Non-trade interest (allocating profit)
Accruals
26
Chargeable gains (allocating profit)
Date of disposal
27
Charitable donations (allocating profit)
Date paid
28
Dividends (allocating profit)
Date of receipt
29
Miscellaneous income (allocating profit)
Time apportion
30
Calculate unindexed gain for corporations?
Net consideration - allowable expenditure
31
Is bank deposit interest included in taxable total profits?
YES
32
Capital allowances in an corporation tax computation?
Deducted from trading income
33
Dividends paid in CT computation?
Disallowable
34
Dividends received in CT computation?
Not included in taxable total profits as they're exempt
35
Patent royalties in CT computation?
Taxed as miscellaneous income
36
Pre-trading expenditure incurred in seven years prior to the commencement of trade in CT computation?
Allowable
37
Security deposit (Allowable/disallowable)?
Disallowable
38
Insurance (Allowable/disallowable)?
Allowable
39
Initial repairs (Allowable/disallowable)?
Disallowable
40
Advertising (Allowable/disallowable)?
Allowable
41
Accountancy fees (Allowable/disallowable)?
Allowable
42
Compliance check (Allowable/disallowable)?
Allowable
43
Legal fees in connection with varying the terms of loan notes (Allowable/disallowable)?
Allowable
44
Legal fees in connection with the issue of share capital (Allowable/disallowable)?
Disallowable
45
Legal fees in connection with the registration of trade marks (Allowable/disallowable)?
Allowable
46
Construction of new car park (Allowable/disallowable)?
Disallowable
47
Repairing the wall of an office buiilding (Allowable/disallowable)?
Allowable
48
Removal expenses (Allowable/disallowable)?
Allowable
49
Fine (Allowable/disallowable)
Disallowable
50
QCD (Allowable/disallowable)
Disallowable
51
Lease of office equipment (Allowable/disallowable)
Allowable
52
Lease of car (Allowable/disallowable)
15% disallowable
53
Entertaining staff (Allowable/disallowable)
Allowable
54
Entertaining overseas customers (Allowable/disallowable)
Disallowable
55
QCD (Allowable/disallowable)
Disallowable
56
Gifts to customers (<£50 and not food or drink) (Allowable/disallowable)
Allowable
57
Gifts to employees (Allowable/disallowable)
Allowable
58
Impairment loss (Allowable/disallowable)
Allowable
59
Interest payable (Allowable/disallowable)
Allowable
60
Advertising (Allowable/disallowable)
Allowable
61
Amortisation (Allowable/disallowable)
Disallowable
62
Employee training courses (Allowable/disallowable)
Allowable
63
Employee pension contributions (Allowable/disallowable)
Allowable
64
Staff party (Allowable/disallowable)
Allowable
65
Legal fees renewal of short lease (Allowable/disallowable)
Allowable
66
Entertaining UK customers (Allowable/disallowable)
Disallowable
67
Political donations (Allowable/disallowable)
Disallowable
68
Counselling services (Allowable/disallowable)
Allowable
69
Employer class 1 and 1A NICs? (Allowable/disallowable)
Allowable
70
Unpaid bonuses (Allowable/disallowable)
Disallowable
71
Interest payable (Allowable/disallowable)
Allowable
72
Gifts to customers (>£50) (Allowable/disallowable)
Disallowable
73
Directors renumeration (Allowable/disallowable)?
Allowable
74
Qualifying charitable donations (Allowable/disallowable)?
Disallowable
75
Loans to finance the purchase of investment property for letting and shares in other companies (Allowable/disallowable)?
Disallowable
76
Depreciation and amortisation of tangible assets used in the trade (Allowable/disallowable)?
Disallowable
77
Capital expenditure and depreciation (Allowable/disallowable)?
Disallowable
77
Loans to purchase or improve let property (Allowable/disallowable)?
Disallowable
78
Qualifying charitable donation (Allowable/disallowable)?
Disallowable
79
Non-Qualifying charitable donation (Allowable/disallowable)?
Allowable
80
Interest payable on loans and overdrafts taken out for a trading purpose (Allowable/disallowable)?
Allowable
81
Incidental costs of raising finance (Allowable/disallowable)?
Allowable
82
Pre-trading revenue expenditure incurred seven years before the start of trading (Allowable/disallowable)?
Allowable
83
Can companies be assessed to corporation tax for a period exceeding 12 months?
No, unlike individuals
84
A short life asset election for corporation tax purposes (duration)?
Must be made within two years of the end of accounting period of purchase
85
What plant and machinery qualifies for 130% super deduction or 50% FYA (enhanced capital allowances)?
New plant and machinery qualified, not expenditure on second-hand assets. Cars did not qualify for the enhanced capital allowances.
86
Capital expenditure (allowable/disallowable)?
Disallowable
87
Interest payable on loans and overdrafts taken out for a non-trading purpose (Allowable/disallowable)?
Disallowable
88
Non-trade interest payable?
Disallowable
89
Loan interest payable on loans taken out by a landlord company in relation to let property?
Disallowable
90
Entertianing UK customers?
Disallowable
91
Entertianing overseas customers?
Disallowable
92
Advertising expenditure that is pre-trading?
Allowable
93
Security deposit?
Disallowable
94
Interest payable?
Allowable, is calculated and deducted
95
Advertising expenditure that is not pre-trading?
Disallowable
96
Patent royalties receivable (relating to trade)?
Not deducted in TTP
97
Where is non-trade interest payable deducted in TTP?
Against the bank interest receivable
98
Rent and business rates?
Allowable
99
Wine and spirits christimas gifts?
Disallowable
100
Are capital losses part of a group relief claim?
NO
101
Legal fees with an issue of £1 preference shares?
Disallowable
102
Legal fees with the issue of loan notes?
Allowable
103
Legal fees with the renewal of a 99-year lease of property?
Disallowable
104
Legal fees with an action brought against a supplier for breach of contract?
Allowable
105
Legal fees with the registration of trade-marks?
Allowable
106
Legal expenses for long-term finance?
Allowable
107
Legal costs for loan to employee?
Disallowable
108
Legal costs for staff employment contracts?
Allowable
109
Non-trade loan interest receivable added or subtracted in TTP?
Added
110
Non-trade loan interest payable added or subtracted in TTP?
Subtracted
111
Is balancing charge time apportioned?
NO
112
Is super deduction and FYA negative or positive in the allowances column in capital allowances?
Negative
113
Qualifying expenditure for SBA?
Buildings, factories and warehouses. Structures (walls, bridges and tunnels)
114
Are capital allowances part of trading profits?
YES
115
How is a lease premium treated in corporation tax?
The divided amount is deducted in corporation tax computation
116
Is bank interest included in trading profit?
NO
117
Director's renumeration?
Allowable
118
Employer's Class 1 NIC?
Allowable
119
Repairs during a serious flood where damage was not covered by insurance?
Allowable
120
Gifts to employees?
Allowable
121
Legal fees for issue of share capital?
Disallowable
122
Legal fees for renewal of short lease?
Allowable
123
Is a 40 year lease considered a short lease?
No, so thereby it is disallowable
124
Loan used to purchase property which is then let out?
Disallowed
125
Interest payable to finance company's trading activities?
A 0 when computing adjusted trading profit
126
Interest receivable to finance company's trading activities?
Deductible when computing adjusted trading profit

TX Accumulated Knowledge (35 decks)

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