Test Questions Flashcards
Question 1 out of 20:
A husband and wife married in 1992:
a.Can each select domicile of the other if they wish
b.Share UK domicile if the husband was UK domiciled at marriage
c.Have their own domicile
d.Share UK domicile if the wife was UK domiciled at marriage
c. Have their own domicile
Question 2 out of 20:
Where an individual does not meet the ‘automatic test’ of residency for tax purposes, they will be tested against the:
a. Habitual determination test
b. Adequacy test
c. Sufficient ties test
d. Regular and habitual test
c. Sufficient ties test
Question 3 out of 20:
Bob gives £400,000 in 2021/22 into a Discretionary Trust. Apart from using his annual £3000 allowance, this is his only transfer. What tax may be due?
a. £75,000
b. Nil
c. £30,000
d. £15,000
d. £15,000
Question 4 out of 20:
Bob is UK domiciled but not UK resident. He dies in 2021/22 leaving £1,000,000 in gilts and £325,000 of other assets. How much IHT is due?
a. £114,000
b. £400,000
c. £274,000
d. Nil
d. Nil
Question 5 out of 20:
What rate of quick succession relief applies on death three and a half years after the initial transfer?
a. 40
b. 20
c. 0
d. 60
a. 40
Question 7 out of 20:
Deano makes a part disposal of land. The value of the land disposed of is £100,000 and the value of the part kept is £250,000. The original cost was £170,000. What is the deemed purchase cost of the part sold?
a. £48,571
b. £46,229
c. £140,000
d. £121,428
a. £48,571
(100,000 / (250,000+100,000)) x 170,000
Question 8 out of 20:
Ginny has bought US$7000 in an attempt to make money from the fluctuating currency market. For CGT purposes:
a. This is exempt
b. This is exempt unless the gain is more than 10%
c. This is chargeable
d. This is exempt unless the gain is more than 20%
c. This is chargeable
As the purpose was not personal but to make money, this is a chargeable event
Question 9 out of 20:
Civil Partners are treated the same way as married people for CGT purposes
a. Only where the partnership is registered post December 2011
b. In no cases
c. Only where the partnership is registered prior to December 2011
d. In all cases
d. In all cases
Question 12 out of 20:
Matt makes a Chargeable Lifetime Transfer on 1st July 2021. When must tax usually be paid?
a, 30th April 2022
b. 5th April 2022
c. 31st July 2022
d, 5th July 2022
a, 30th April 2022
Tax due after 6 months, when transfer made between 5th April and 1st October, tax is due following 30th April
Question 15 out of 20:
No charge is made under Pre Owned Asset Tax where the cash value of benefits is less than:
a. £5,000
b. £4,800
c. £2,500
d. £3,600
a. £5,000
Question 17 out of 20:
For how long must a business interest have been owned to qualify for IHT Business Relief?
a. 2 years
b. 1 year
c. 3 years
d. 7 years
a. 2 years
Question 18 out of 20:
Mabel married Arthur in 1952. She was, at the time, Canadian domiciled while Arthur was UK domiciled. She is now:
a. UK domiciled
b. Canadian Domiciled
c. Dual UK and Canadian domiciled
d. Able to select either UK or Canadian domicile
a. UK domiciled
Question 19 out of 20:
How much can Win and Fred give their grandson on marriage as an exempt transfer for IHT?
a. £5,000
b. £7,500
c. £15,000
d. £12,000
a. £5,000
Question 1 out of 20:
Karl lives in rented accommodation. He buys a house to develop and sell on. He does not live in the house:
a.The gain is automatically exempt under the Enterprise Act 2003
b.He cannot claim principle private residence relief for CGT
c.He can claim sole property relief instead of principle private residence relief
d.He can claim principle private residence relief as he does not own another property
b.He cannot claim principle private residence relief for CGT
Question 3 out of 20:
What top rate of tax is due at the time of making a Chargeable Lifetime Transfer of £400,000 in 2021/22 assuming no other gifts in the last 7 years?
a.20%
b.40%
c.0%
d.10%
a.20%
Question 4 out of 20:
What rate of Business Relief will apply to a holding of £1,000,000 in a company quoted on the Alternative Investment Market where this has been held for two and a half years prior to death?
a.25%
b .Nil
c.50%
d.100%
d.100%
Question 6 out of 20:
In order to benefit from the transfer of Nil Rate Band for IHT purposes, the second spouse must have died after:
a.6-Apr-08
b.5-Mar-08
c.8-Oct-07
d.5-Mar-07
c.8-Oct-07
Question 7 out of 20:
Which of the following is NOT a gift with reservation for IHT?
a.Giving away a freehold interest in land but keeping a lease granted 2 years before the gift
b.Giving away money but not the interest from the money
c.Giving away a house but remaining living there
d.Giving a painting to a son living next door
d.Giving a painting to a son living next door
Question 8 out of 20:
Dean was given an asset by his brother in March 2003. No money changed hands. He is now selling the asset. For CGT purposes the base cost is:
a.The market value at the date he acquired it LESS the costs of disposal
b.The market value at the date the original owner acquired it, PLUS purchase costs
c.The market value at the date his brother acquired it
d.The market value at the date he acquired it
d.The market value at the date he acquired it
Question 11 out of 20:
Danny emigrates to Australia. He keeps UK domicile for:
a.Life
b.7 years
c.3 years
d. 5 years
d. 5 years
Question 12 out of 20:
The adding back of previous gifts when calculating death IHT is know as:
a. The accumulation principle
b. The cumulation principle
c.The PET principle
d. The transferor principle
b. The cumulation principle
Question 15 out of 20:
Nicky bought a painting in June 1976. For CGT purposes, the base value is:
a. The value at 6th April 1998
c. The value at 5th April 1982
c. The value at 31st March 1982
d. The value at June 1976 rolled forward with inflation
c. The value at 31st March 1982
Question 16 out of 20:
Ant makes a Chargeable Lifetime Transfer of £200,000. Three years later he makes a PET of £1m. After a further 5 years he dies leaving nothing of value. For IHT:
a. Tax will be due on £1,000,000 less the Nil Rate Band and with taper relief applicable
b. Tax will be due on £1,200,000 but with taper relief applicable
c. There is no tax due
d. Tax will be due on £1,200,000 less the Nil Rate Band and with taper relief applicable
d. Tax will be due on £1,200,000 less the Nil Rate Band and with taper relief applicable
Question 17 out of 20:
In respect of CGT, losses:
a.Can be carried forward but must be used AFTER losses from earlier years
bCan no longer be carried forward
c.Can be carried forward but must be used BEFORE losses from earlier years
d.Can be carried forward and offset with gains from earlier years according to the individual’s wishes
c.Can be carried forward but must be used BEFORE losses from earlier years