INCOME TAX

Question 1

When UK res if split year and coming back to UK?

Answer 1

From day after finishing overseas job

Question 2

When non res if split year and leaving UK?

Answer 2

“From DAY STARTING OVERSEAS JOB
‘Provided the full time work overseas conditions are met’”

Question 3

What to look at if considering split year treatment (and someone e.g. going on secondment)

Answer 3

Full time UK work test

Question 4

Doing the overseas tests in split residence?

Answer 4

PRO RATE the days

Question 5

What to remember when someone is a split resident?

Answer 5

PA is TAPERED

Question 6

How is e.g. dividend income treated when someone is on the remittance basis?

Answer 6

ALL NSI

Question 7

Overseas and business pay for accommodation?

Answer 7

No IT

Question 8

Overseas and visits of parents expensed?

Answer 8

YES IT

Question 9

Selling UK shares while overseas?

Answer 9

“ANTI AVIODANCE RULE
Even if non-res, still taxable (on return) if in 5y”

Question 10

What to remember if someone is non UK domiciled?

Answer 10

“Could ELECT REMMITANCE BASIS
In respect of their foreign income
But there are charges
If O/S income is low (2k) then it is automatic
Do both calcs and see which one is better!”

Question 11

Deciding whether to elect for the remittance basis and on a high income so lost PA?

Answer 11

R.B. more desirable because it doesn’t matter that the R.B. removes the PA

Question 12

Pension annual allowance

Answer 12

“60k
Get 3y previous
When it was 40k
AA charge over this”

Question 13

What 2 things to remember when an individual pays into their personal pension?

Answer 13

“1. MAXIMUM RELIEF (Basically income with a 3,600 floor)
2. Annual allowance is TAPERED at high income (260k ‘adjusted income’)”

Question 14

How to deal with property interest for an individual?

Answer 14

You get the 20% tax reducer, but then ofc are taxed on the whole income WITHOUT DEDUCTING THE INTEREST

Question 15

Difference for employer when paying ltd company (assuming no OMB rules)?

Answer 15

“No NIC (Because paying an invoice)
They will ask the ltd company to pay it”

Question 16

IR35 deemed income: “Less: Class 1 secondary NICs (Y × 13.8/113.8)”

Answer 16

Means multiply by the WHOLE (13.8/113.8) i.e. Y x (13.8/113.8) NOT one or the other

Question 17

Difference between OPW when anti avoidance rules do apply, and just being an employee?

Answer 17

“Salary paid to ltd company not the individual
But no further tax when extracting as a dividend”

Question 18

OMB & large loss relief claim?

Answer 18

“LOSS RELEIF FOR OMBS IS CAPPED
(Just 25% ANI, min 50k)
(ANI is just INCOME plus payroll giving less grossed up personal pension)”

Question 19

Issues with OMB opening loss relief?

Answer 19

“HAVE TO go all 4y back, &
On TOTAL INCOME (Not just trade)

So risk of wasting lots of PA unless know 4y back”

Question 20

Do sole traders get capital allowances?

Answer 20

“YES
You still get capital allowance as as sole trader”

Question 21

Receive shares not in tax-advantaged scheme?

Answer 21

“Income Tax liability on gain
(Only NIC if readily convertible asset i.e. listed company)”

Question 22

Beneficial interest - what does the company have to pay?

Answer 22

1A NICs (@ 13.8%)

Question 23

How is statutory redundancy related for IT?

Answer 23

“ALL FULLY EXEMPT
(Tho reduces the 30k limit)”

Question 24

Which rate is better: BR IT or marginal CT (20-250k)?

Answer 24

Basic rate @ 20%

Question 25

When is PA tapered?

Answer 25

Over 100k

Question 26

Is an employer giving you money though an EIS scheme taxable income?

Answer 26

YES! it still is