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Question 1

Ramsey principal

Answer 1

Ignore a series of transactions that are tax avoidance and determine the transactions tax liability by its end result

Question 2

How long do you have to pay IHT for a lifetime transfer and death transfer?

Answer 2

Lifetime transfer - 6months from end of month of transfer

Death transfer - 6months from end of month of death

Question 3

IR35

Answer 3

Helps HMRC get additional tax from those classes as employed in all but name

Question 4

Trading allowance

Answer 4

If less than £1k trading income then do not need to declare income.

If over £1k, can either claim £1 or claim expenses

Question 5

If let out part of resi. home what is the CGT exemption?

Answer 5

£40k per person. Then taxable on anything above this.

Question 6

Chattel exemption amount

Answer 6

£6k per person. Then taxable on anything above this on the lower of:

The whole actual gain

Or

5/3rds of excess over £6k allowance

Question 7

When is CGT due?

Answer 7

31st Jan

Question 8

If there is excess input VAT to output VAT is that difference then refunded by HMRC or submitted to HMRC?

Answer 8

Refunded by HMRC (RI>O)

Question 9

Are REIT’s subject to stamp duty on stock purchases?

Answer 9

Yes

Question 10

Can losses from corporate bonds or GILT’s be carried forward into future tax yrs?

Answer 10

Corporate bonds only

Gilts - No

Question 11

RNRB does not apply to what?

Answer 11

Does not apply to gifts made during lifetime so no PET or CLT’s

Question 12

How long do you have to claim a second NRB?

Answer 12

2yrs from end of month of death occurring

Or

3 months of beginning to act as personal representatives

Question 13

How to calculate IHT when a PET is made

Answer 13

1. Deduct PET transfer 100% total from NRB (used gift exemption of £3k/£6k?)
2. Deduct remaining NRB from death transfer amount
3. Remaining death transfer amount x 40%

Question 14

how to tell when a transfer or gift is a PET or CLT?

Answer 14

PET - Generally a gift

CLT - Generally DAMPS only

Question 15

Who is liable to pay a PET?

Answer 15

The recipient

Question 16

What amount is needed for a charity contribution to then classify for reduced IHT?

Answer 16

10% after NRB and reliefs (such as political party contrib.)

Question 17

When are you deemed domicile?

Answer 17

When resident for 15yrs of last 20yrs

Question 18

When non UK domicile what do you pay tax on?

Answer 18

Anything that goes through UK

Question 19

Tax payable on arising and remittance basis

Answer 19

Arising - tax on foreign income as it arises

Remittance- tax payable when brought into UK

Question 20

Key self assessment deadline dates

Answer 20

Tax returns issued by HMRC - 6th April

Deadline for submitting return on paper - October 5th

Deadline for submitting return online if want underpayment - December 30th

Deadline for submitting return online & first payment- Jan 31st

Second payment - July 31st

Question 21

How many days must SDLT be paid within?

Answer 21

14days from completion date

Question 22

Stock/scrip dividends

Answer 22

Company offers a choice of receive dividends or new shares

Question 23

Innovative finance ISA

Answer 23

Peer to peer lending

Question 24

Why are life assurance policies/bonds not subject to CGT? When is this paid?

Answer 24

Suffer from a CLT and so not categorised to suffer CGT so instead pay income tax on gains

Paid when chargeable event occurs (DAMPS)

Question 25

Why are life assurance bonds often written in trust?

Answer 25

Saves admin. work as receive not income producing asset and returns within 5% classed as return of capital

Question 26

Who is a vulnerable beneficiary for a trust?

Answer 26

Someone under 18

A disabled person - physically or mentally

Question 27

How does GAAR ensure consistent application?

Answer 27

A designated officer follows a set of procedures that allows the taxpayer to explain why they should not be subject to GAAR. Then reviewed by GAAR panel.

Question 28

What is the effective income tax rate between £100,000 and £125,140

Answer 28

60%

Question 29

How long can a deed of variation be enacted upon after death on a will?

Answer 29

2yrs after death

Question 30

Annual IHT exemption and small gift exemption

Answer 30

£3k and can use prev. yr so can be £6k

£250 small gift exemption per beneficiary

Question 31

Can a mortgage reduce the IHT liability?

Answer 31

Yes

Question 32

What tax exemption on savings do non tax payers get?

Answer 32

£6k as £5k starting rate exemption and £1k PSA

Question 33

What can suffer from a market value reducer if redeem early?

Answer 33

Life assurance policies/bonds as stops dilution

Question 34

What form do you claim non-UK resi. or domicile status on?

Answer 34

P85

Question 35

Would you be best disposing of losses on assets before or after leave UK permanently?

Answer 35

Before so can carry losses forward for future years

Question 36

How do landlords generally receive rent when non UK resi.?

Answer 36

Net of 20%, however can apply for rent to be paid gross

Question 37

Do you have to be UK domicile to invest in an ISA?

Answer 37

No UK resi. only

Question 38

General rules for IT, CGT, IHT if who have left the UK

Answer 38

IT- Liable on anything arising in the UK

CGT - Liable on gains from UK assets for 5yrs following departure

IHT - If remain UK domicile upon leaving then liable to UK IHT on worldwide assets for at least 5yrs

Question 39

Thing to remember for IHT questions?

Answer 39

Have they used their annual exemption of £3k (£6k max.)

Question 40

When creating a trust what can a settlor choose to do to CGT?

Answer 40

Elect to hold over CGT to trustees

Question 41

Can you transfer VCT shares but keep income tax relief?

Answer 41

Yes