Question Practice Flashcards
VAT on services incurred before registration can be recovered on services supplied in
the 6 months before registration
VAT on goods can be recovered on goods supplied within
4 years before registration if supplied for business purposes and are still in the business
Is VAT on entertaining suppliers recoverable?
no
When does companies first accounting period start
First acquires source of chargeable income to date commences to trade
When is a companies second period of account
Date trade commences to end of first POA
When is companies third period of account
Same dates as POA
IHT - Land and buildings - where located for IHT if ND
L&B
where physically situated
IHT - Land and buildings - where located for IHT if ND
Debt
Where the debtor resides
IHT - Land and buildings - where located for IHT if ND
Life policies
Where proceeds are payable
IHT - Land and buildings - where located for IHT if ND
Registered shares and securities
Where they ar registered
IHT - Land and buildings - where located for IHT if ND
Bank accounts
At the branch where the account is kept
IHT - Land and buildings - where located for IHT if ND
Interest in partnership
Where partnership business carried on
IHT - Land and buildings - where located for IHT if ND
Goodwill
Where the business to which it is attached is carried on
IHT - Land and buildings - where located for IHT if ND
Tangible property
At physical location
IHT - DTR tax credit is the
lower of foreign tax liability and IHT at average rate on asset
IHT if UKD or / Deemed Dom UK assets and overseas assets
UK - assessable
Overseas - Assessable
IHT if UK ND UK asset/overseas
UK - Assessable
Overseas - Exempt
IHT - Insurance policy on someone else’s life amount to include in death estate is the
Market value
IHT - valuing shares at the
lower of the quarter up and average marked bargain
IHT Average marked bargain
Lowest + highest / 2
VAT on rent / building is normally
Exempt - option to tax on commercial properties
VAT on sale/construction of new residential building
Zero rated supply
VAT on sale / construction of new commercial building (,3y)
20%
If enact option to tax it is in place for
20 Years but there is a 6 month cooling off period
Stamp duty is based on
VAT inclusive value
Required level of PII
If gross fee income is less than £600,000, then minimum level is 2.5 * gross fee income subject to minimum of £100,000
otherwise minimum is £1.5m
How long must PII cover be maintained after retirement
at least two years, preferably for six
PCRT - Client specific meaning
tax planning must be specific to particular clients facts and circumstances
clients must be alerted to wider risks and implications of any courses of action
PCRT - Lawful meaning
Members must act lawfully and with integrity and expect the same from their clients. Tax planning should be based on realistic assessment of facts and credible view of thhe law.
PCRT - Disclosure and Transparency
Tax advice must not rely for its effectiveness on HMRC having less than the relevant facts, any disclosure must fairly represent all relevant facts
PCRT - Advice on tax planning
Members must not create, encourage or promote tax planning arrangements that set out to achieve results that are contrary to the clear intention of parliament in enacting relevant legislation or are highly artificial/contrived and seek to exploit short comings
PCRT - Professional judgement and appropriate documentation
Professional judgement must be exercised
notes should be kept with rationale of PJ
What are the three scenarios where professional accountant may disclose confidential information
Authorised by client/employer
Disclosure is required by law (legal proceedings/AML)
Professional duty/right to disclose when not prohibited by law (quality review of prof body, protect own interests in legal proceedings)
Conflict of interest - secondment to HMRC - steps to take
secondee not involved in matters relating to the seconding organisation/clients
following end of secondment, secondee should not be involved in the affairs of any taxpayer they were involved with at HMRC for a significant period
serve interests of HMRC during secondment
manage any potential conflicts of interest between HMRC and employer
GDPR requirements with processing personal data-
process lawfully, fairly and transparently in relation to individuals
Collected for specified, legitimate purposes and not processed further
adequate, relevant and limited to what if necessary in relation to purposes for which they are processed
accurate, and where necessary kept up to date
kept in form which permits identification of individuals for no longer than is necessary
processed in manner that ensures appropriate security of personal data
Who monitors compliance with UK GDPR
Information Commissioner’s Office (ICO
A Data protection officer must be appointed for
public authorities, public bodies or organisation carrying out certain types of processing.
Organisations handling personal data must notify
the ICO that they are data controller and be added to register of data controllers. Failure to notify is strict liability offence
Where there is a breach of data likely to result in a risk to the rights and freedoms of individuals, the breach must be reported
within 72 hours of first coming to light.
For organisations, fines can be tiered up to a maximum of 4% of annual global turnover or 20m euros
Precautions to prevent unauthorised access to client information on computer
access credentials kept safe from authorised use
computers physically secure
password changed every 3m or regularly
users have own unique log in
any unusual / unexpected activity on client HMRC record reported to HMRC
suspicious emails appearing to be from HMRC should be forwarded to their phishing team
Money laundering definition
possessing or in any way dealing with or concealing proceeds of any crime or terrorist funds
MLRO Responsibilities
considering internal reports made to them where there are suspicions of ML
If consider to be appropriate, reporting to NCA via external report SAR
compile and send the SAR
Specific offences for MLRO failing to make a report where needed
Defences against failure to report ML
- individual did not know / suspect ML (lack of training - offence on part of employer)
- privilege reporting exemption (only where legal advice is given/advice in course of litigation)
Reasonable excuse for not making a report (extreme duress and threats to safety)
Known/reasonably believed ML taking place outside the UK and not unlawful where taking place
Where does privileged exemption apply
Where legal advice is given or advice is given in the course of litigation
AML procedures
register with supervisory authroity
appoint MLRO and implement internal reporting procedures
train staff on legislation and how to recognise and deal with ML and report MLRO
have appropriate internal procedures relating to risk assessments and management to deter and prevent ML
Carry out Customer DD on new clients and monitor existing clients
verify identify of new clients and evidence of identification and records maintained
Report suspicions on SAR to NCA
How long must records of client identification be maintained after termination of client relationship
five years from date when all activities in relation to transaction were completed
What is implication of leaving death estate to spouse who is not UK Dom/Deemed dom
spousal exemption is limited to 325000
advantages of VAT group
No VAT due on supplies between them, only one VAT return between them
When can non-corporate entity (partner or individual) join a VAT group with corporate subsidiaries
if it controls all members of the VAT group
Where is there a SDLT group
where there is 75% shareholding (direct or indirect) between companies
Individuals cannot be in the group as they are not companies
Sufficient ties - when have substantive UK work
at least 3 hours per day for at least 40 days in the tax year
