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Tax > Stuff to rememner > Flashcards

Stuff to rememner Flashcards

1
Q

Pension scheme contributions

A

Are exempt

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2
Q

Pension scheme contributions

A

Are exempt

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3
Q

Trivial benefits are exempt when

A

cost < £50 to provide

capped at £300

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4
Q

Pension and associated tax planning are exempt when

A

available to all employees

up to £500 per tax year

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5
Q

Childcare facilities run by employer are

A

exempt

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6
Q

Childcare payments are exempt for (3)

A
  • under £55 a week starting before 6/4/2011
  • for those joining since 6/4/11, limit is £28 p/w for higher rate and £25 p/w for additional rate payers
  • scheme not available to new applicants after 4 october 2018
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7
Q

mobile phone is exempt

A

if one phone, still exempt if available for private use

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8
Q

Free/subsidised meals are exempt if

A

offered to all employees

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9
Q

Parking space near place of work is?

A

exempt

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10
Q

bikes and safety equipment is?

A

exempt if offered to all employees

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11
Q

Responsibilities of HMRC:

1) Collect and administer
2) Pay and adminster
3) Collect repayments of
4) Ensure employers meet
5) Protect us from

A

1) collect and administer IT, CGT, NIC, CT and VAT
2) Pay and administer universal credit, tax credits and child benefit
3) Collect repayments of student loans
4) Ensure employers meet minimum wage requirements
5) Protect us from tax fraud, smuggling, drug importation

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12
Q

Sources of tax law (3)

A

Tax statutes
Finance acts
Statutory instruments

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13
Q

Exempt income examples: (5)

A 
ISAs
Betting
Lottery
Premium bonds
Scholarships
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14
Q

Savings income tax free:

How much? why?

A

Up to £5000, if non saving income is

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15
Q

Gift aid

A

Charity receives donationx(100/80)

extend tax limits by gross donation (tax inclusive)

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16
Q

Marriage allowance

A

May transfer 1250 of PA if:
Transferor = basic or non taxpayer
Transferee = basic rate taxpayer

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17
Q

General rules of taxable benefits: (3)

A

benefit = cost to employer
Always time apportion
Always deduct employee contributions

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18
Q

Not job related accommodation tax

A

1: higher of rental value or annual value
2: additional charge if cost > £75000
interest rate x (cost - 75000)

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19
Q

Use market value of accommodation if

A

Acquired for more than £75000 and gap of 6 years until employee moves in

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20
Q

Taxable benefit of furniture

A

20% x market value

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21
Q

List price of car includes: (2)

A

Optional accessories provided with car

Further accessories value >£100 provided later

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22
Q

Taxable benefit for fuel

A

£24500 x co2 rate%

No reduction for partial employee contribution

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23
Q

taxable benefit of assets for private use

A

higher of
20% x market value when provided
rent paid by employer for asset

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24
Q

Income tax and NICs through PAYE due

A

19th of each month (22nd if electronic payments)

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25
Q

Number of employees for must pay PAYE electronically

A

250

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26
Q

Can pay PAYE quarterly if

A

monthly PAYE total <1500

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27
Q

PAYE codes: positive? negative? Marriage allowance?

A

if PA is positive: remove last digit, add L to end
if PA is negative : remove last digit, deduct 1, add K at beginning
if marriage allowance: add N for transferor, add M for transferee

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28
Q

CapEx allowable or disallowable?

A

Disallowable (ie taxable)
Improvement or enhancement is disallowable
depreciation is disallowed
but repairs and maintenance are allowable

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29
Q

Trading income not taxable if

A

receipts <1000

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30
Q

Appropriations of profit allowable or disallowable?

A

Disallowable

except reasonable payment to family as salary

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31
Q

Bad debts allowable or disallowable?

A

Trade bad debts = allowable

non-trade bad debts disallowable

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32
Q

Entertaining allowable or disallowable?

A

Staff entertaining: allowable

Customer entertaining: not

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33
Q

Allowable gifts are

A

To employees
Trade samples
To customers if: business name on it, no food drink tobacco or vouchers, cost<50

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34
Q

Donations allowable or disallowable?

A

Small local charities = allow
National charities = disallow
Political = disallow
Gift aid = disallow

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35
Q

Fines and penalties allowable or disallowable?

A

Disallow

except parking fine of employee on business

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36
Q

Interest allowable or disallowable?

A

on business loans = allow

on late payment of tax, non-business loans = disallow

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37
Q

Employment payments and pensions allowable or disallowable?

A

allowable

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38
Q

Employment payments and pensions allowable or disallowable?

A

allowable

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39
Q

Trivial benefits are exempt when

A

cost < £50 to provide

capped at £300

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40
Q

Pension and associated tax planning are exempt when

A

available to all employees

up to £500 per tax year

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41
Q

Childcare facilities run by employer are

A

exempt

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42
Q

Childcare payments are exempt for (3)

A
  • under £55 a week starting before 6/4/2011
  • for those joining since 6/4/11, limit is £28 p/w for higher rate and £25 p/w for additional rate payers
  • scheme not available to new applicants after 4 october 2018
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43
Q

Period of ownership is _____ for calculating WDA of assets

A

irrelevant (do not x9/12 for 9 months ownership in period)

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44
Q

Free/subsidised meals are exempt if

A

offered to all employees

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45
Q

Parking space near place of work is?

A

exempt

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46
Q

bikes and safety equipment is?

A

exempt if offered to all employees

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47
Q

Responsibilities of HMRC:

1) Collect and administer
2) Pay and administer
3) Collect repayments of
4) Ensure employers meet
5) Protect us from

A

1) collect and administer IT, CGT, NIC, CT and VAT
2) Pay and administer universal credit, tax credits and child benefit
3) Collect repayments of student loans
4) Ensure employers meet minimum wage requirements
5) Protect us from tax fraud, smuggling, drug importation

How well did you know this?
1
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2
3
4
5
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48
Q

Sources of tax law (3)

A

Tax statutes
Finance acts
Statutory instruments

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49
Q

Exempt income examples: (5)

A 
ISAs
Betting
Lottery
Premium bonds
Scholarships
50
Q

Savings income tax free:

How much? why?

A

Up to £5000, if non saving income is

51
Q

Gift aid

A

Charity receives donationx(100/80)

extend tax limits by gross donation (tax inclusive)

52
Q

Marriage allowance

A

May transfer 1250 of PA if:
Transferor = basic or non taxpayer
Transferee = basic rate taxpayer

53
Q

General rules of taxable benefits: (3)

A

benefit = cost to employer
Always time apportion
Always deduct employee contributions

54
Q

Not job related accommodation taxable

A

1: higher of rental value or annual value
2: additional charge if cost > £75000
interest rate x (cost - 75000)

55
Q

Use market value of accommodation if

A

Acquired for more than £75000 and gap of 6 years until employee moves in

56
Q

Taxable benefit of furniture

A

20% x market value

57
Q

List price of car includes: (2)

A

Optional accessories provided with car

Further accessories value >£100 provided later

58
Q

Taxable benefit for fuel

A

£24500 x co2 rate%

No reduction for partial employee contribution

59
Q

taxable benefit of assets for private use

A

higher of
20% x market value when provided
rent paid by employer for asset

60
Q

Income tax and NICs through PAYE due

A

19th of each month (22nd if electronic payments)

61
Q

Number of employees for must pay PAYE electronically

A

250

62
Q

Can pay PAYE quarterly if

A

monthly PAYE total <1500

63
Q

PAYE codes: positive? negative? Marriage allowance?

A

if PA is positive: remove last digit, add L to end
if PA is negative : remove last digit, deduct 1, add K at beginning
if marriage allowance: add N for transferor, add M for transferee

64
Q

CapEx allowable or disallowable?

A

Disallowable (ie taxable)
Improvement or enhancement is disallowable
depreciation is disallowed
but repairs and maintenance are allowable

65
Q

Appropriations of profit allowable or disallowable?

A

Disallowable

except reasonable payment to salary as salary

66
Q

Bad debts allowable or disallowable?

A

Trade bad debts = allowable

non-trade bad debts disallowable

67
Q

Entertaining allowable or disallowable?

A

Staff entertaining: allowable

Customer entertaining: not

68
Q

Allowable gifts are

A

To employees
Trade samples
To customers if: business name on it, no food drink tobacco or vouchers, cost

69
Q

Donations allowable or disallowable?

A

Small local charities = allow
National charities = disallow
Political = disallow
Gift aid = disallow

70
Q

Fines and penalties allowable or disallowable?

A

Disallow

except parking fine of employee on business

71
Q

Interest allowable or disallowable?

A

on business loans = allow

on late payment of tax, non-business loans = disallow

72
Q

Legal and professional fees allowable or disallowable?

A

Trade related = allow
dealings with HMRC = disallow
capital related legal fees = disallow

Exception: allowable if legal fees for renewal of short lease (50 years)

73
Q

Employment payments and pensions allowable or disallowable?

A

allowable

74
Q

Hiring, renting plant and equipment allowable or disallowable?

A

allowable

75
Q

Leasing a car allowable or disallowable?

A

CO2 > 110 disallowance = 15% x hire charge
CO2 <110 allowable

CO2>110 and private use disallow = allowable - (85% x hire charge x business%)

76
Q

Adjustment to profit for goods taken for private use

A

income adjustment must reflect market value not cost

77
Q

Non-trade income most be ____ trading profits.

Non trade incomes include:

A

deducted from

Rental income, profits on disposal of fixed assets, investment income

78
Q

Assets in the main pool include

A

Machinery and equipment
Vans, lorries
Cars with high emissions

79
Q

Period of ownership is _____ for calculating WDA of assets

A

irrelevant (do not x9/12 for 9 months ownership in period)

80
Q

If written down value in main pool <1000

A

write off balance as an allowance

81
Q

Single asset pools are for

A

Assets with private use by the business owner (only allow for business use %)

82
Q

If asset pools end negative?

If asset pools end positive?

A

Give back excess as balancing charge

Take away balancing allowance (still business use %)

83
Q

AIA is

A

Annual investment allowance = £200,000

Applies to most P&M but not cars

84
Q

Small pools written

A

If main pool ends <1000

85
Q

Checking overlap profits

A

Count back months from March

March = 0, Feb = 1, etc..

86
Q

Tax for closing accounts

A

From end of last period to date of ceasing

Then deduct the overlap profits

87
Q

Cash basis accounting, receipts amounts?

A

Can start with <150000

Must leave when previous year >300000

88
Q

Class 1A contributions are a tax on

A

Taxable benefits, suffered by employer

89
Q

Inform HMRC of need for self assessment return by:

A

October 5th following tax year

90
Q

Short tax return

A

for people with turnover <85000

HMRC calculate your tax

91
Q

HMRC can amend tax returns with errors

A

Within 9 months of actual filing date

92
Q

Taxpayer can amend tax returns: Any reason? Overpayment?

A

Within 12 months of normal submission (31 Jan)

Within 4 years of end of tax year

93
Q

POAs not required if

A

Last years tax paid under self assessment was less than 1000 or less than 20% of total liability

94
Q

Balancing payments are: Due by? for what?

A

31 Jan following tax year
Balance of IT and Class 4
CGT
Class 2

95
Q

Interest on late payments

A

Calculated from day after actual submission date to the day before payment is made

96
Q

Must keep records for:
Corporation tax?
Income and CGT?
VAT?

A

6 years from end of accounting period

Fifth anniversary of 31 Jan after tax year (if business)
First anniversary of 31 Jan after tax year (if not)

6 years

97
Q

Record keeping penalties

A

£3000 for each year/accounting period

98
Q

Senior Accounting Officer (SAO)
Role?
Penalty?
Qualifying?

A

Ensure adequate records are kept
£5000 penalty for failure
Turnover>£200M and/or BS total>£2B

99
Q

Assets exempt from CGT

A 
Cash
Cars
Gilt securities
ISAs
National savings and bonds
100
Q

Chattels rules: wasting? non?

A

Wasting=exempt
Non-wasting= <6000 exempt
>6000 use 6000 value and 5/3 rule

101
Q

Exemptions for capital gains: Business? Individuals?

A

No annual exempt amount for companies

12300 individuals

102
Q

Augmented profits=

A

TTP + exempt ABGH distributions (dividends from UK and overseas non-51% group companies)

103
Q

Augmented profits limits

A

1.5mil and 20mil

Scaled down for short accounting periods

104
Q

Non-large/very large companies corp tax payment date

A

9 months and 1 day after end of accounting period

105
Q

Time after beginning to give written notice for corp tax

A

3 months

106
Q

Corp tax return must be submitted

A

Within 12 months of end of accounting period

107
Q

Can deregister for VAT if

A

Taxable turnover in next 12M is less than 83000

108
Q

Must register for VAT if? Notify? Start?

A

Historic test (12 months) >85000
Notify 30 days, start next month after notifying
Future test (next 30 days) >85000
Notify 30 days, start day of test

109
Q

Actual tax point

A

Earlier of:
Goods available/service complete (basic tax point)
Payment received
Invoice issued

If BTP is used, then use invoice if issued within 14 days

110
Q

Bad debt VAT relief if:

A

Debt > 6 months overdue and

Debt written off

111
Q

Input VAT is irrecoverable for:

A

Cars (unless exclusively for business)
Customer entertaining
Non business items
Items with no VAT receipt

112
Q

Input VAT before registration can be recovered on first return if:

A

Goods supplied within 4 years and still in use

services within 6 months

113
Q

VAT substantial trader

A

VAT liability>2.3M
1/24 previous total liability paid at end of second and third months of each quarter
Then balancing payment at end of month following quarter

114
Q

Keep VAT records for:

A

6 years

115
Q

A ‘simplified’ invoice can be issued for

A

supplies under £250

116
Q

Flat rate VAT scheme

A

industry % x Turnover (VAT included)
Includes all exempt and taxable
1% reduction in first year of registration

117
Q

Small business VAT penalties

A

Turnover <150000

One extra chance before penalties

118
Q

You can correct VAT errors on next return if:

A

error less than

£10000 or 1% taxable turnover up to 50k

119
Q

Notice of intention to make an enquiry by HMRC by:

A

First anniversary of actual submission date

or if late year from end of quarter of submission

120
Q

Time limits for discovery assessments

A

Not due to careless or deliberate behaviour = 4years

Careless = 6 years

Deliberate = 20 years

121
Q

Taxpayer may appeal against? how long?

A

Request to submit documents, compliance check amendments, discovery assessment, VAT assessment, imposition of penalty

30 days to appeal

122
Q

True or false? FYAs are effected by business use

A

True

Tax (2 decks)

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