Planning Tech Questions Flashcards
What is the annual allowance?
£60,000 (gross)
How the does the annual allowance taper for higher earners work?
£1 for every £2 you earn over £260,000 allowance tapered stops at £10,000
At what level of income does it taper?
(pensions)
£260,000 to £360,000
What is the LSDBA?
The Lump Sum and Death Benefit Allowance (LSDBA) is the maximum amount of tax-free lump sum benefits that can be paid out from a pension scheme. This includes any lump sum death benefits paid out after the account holder’s death.
The LSDBA is usually £1,073,100, but it can be higher if the account holder has a protected allowance.
If the LSDBA is exceeded, the excess amount is subject to income tax.
(if they die pre 75 the LSDBA is how much beneficiaries can receive tax free)
How many years of allowance can be carried forward?
Up to 3 previous tax years
Cost to set up a Drawdown?
£200 initial cost
Annual cost to run a drawdown?
£150 thereafter (VAT on top of both)
How old do you have to be to start making contributions to a SIPP?
From birth, after 75 can still make contributions but no longer get tax relief
What are the transfer out fees for a SIPP?
£25 per line of stock, Minimum of 4 (£100), cash is one line.
What is the tax charge on pensions valued in excess of the LTA?
There is no LTA tax charge as of April this year.
What tax relief is earned on personal contributions?
20% for basic rate tax payers and higher rate tax payers get 20% if claimed through self assesment and 45% for additional rate
What tax relief is earned on company contributions?
Individuals do not get any tax relief on company contributions
At what age can benefits be taken from a SIPP?
55
How is a SIPP treated differently if the holder dies before or after 75?
Before 75 the SIPP can be passed down to the beneficiary tax-free, after 75 taxes can be applied. Both circumstances outside of deceased estate for IHT purposes.
A client contributed £30,000 Net to their Killik SIPP, after tax relief how much will be contributed gross?
£30,000/0.8 = £37,500
What does UFPLS stand for?
Uncrystallised fund pension lump sum
Rate of tax relief on personal contributions recevied through a Killik SIPP?
20%
If somebody has no income in a tax year, what can they contribute (Gross and Net)
£3,600 Gross & £2,880 Net
What is the maximum percentage of a client’s wealth that can be held in Physical Gold Bullion within their SIPP?
30%
What does QROPS stand for?
Qualified recognised overseas pensions schemes
2 types of drawdown?
Flexi access & Capped drawdown
What are the three pensions crystalisation events?
Going into drawdown, turning 75 or death
What is the LSA
£268,275
What are the three main services included in Killik Complete?
Tax & Trustee Services (Wills, POA’s, Trusts, Executorships) Investment Management (MIS), Wealth Planning
What is APS
Additional permitted subscription - when someone can inherit an ISA allowance left behind by a spouse or civil partner when they die.
What is the limit a Settlor can put into a Trust in any 7 seven period before triggering a lifetime Inheritance Tax charge?
£325,000. Everything above the threshold is taxed at 20%
Under the Law of Intestacy (applying where the deceased leaves no will), at what age will a child be entitled to his or her share of the estate?
18
At what period of intervals does the capital of a discretionary trust get assessed by HMRC?
Annual Trust Administration fee
Every 10 years
0.25% Killik admin fee
Can you subscribe to more than one ISA
yes more than one S&S ISA, total 20k allowances across all
Can a grandparent open a JISA
ney - only parent or gaurdian
Age to open adult ISA
LISA
18
18-39
Name 4 diversifiers in a portfolio
Corp Bonds
Gold
Gov Bonds
Property
Max State Pension and criteria to receive max
£11,500
35yrs of NICS
10 yrs min
Net Pay v Relief at Source
Net pay
The employer deducts pension contributions before tax
You pay tax on what’s left
Relief at source
The employer deducts pension contributions after tax
The pension provider claims tax relief of 20% from the government
This is added to your pension
You may need to claim extra tax relief if you pay higher rates of tax
