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R03
Questions
| Question | Answers | Answer |
|---|---|---|
| Margaret is a higher-rate taxpayer and has total dividend income of £60,000, all of which falls within the higher rate tax band. How much tax will she pay on this income in 2023/24? | a. £24,000. b. £19,912.50. c. £19,175. d. £20,250 | b. £19,912.50. |
| When calculating an individual's income tax liability certain payments are tax reducers, including | interest payments and investments into venture capital trusts. interest payments and investments into EIS. investments into EIS and VCT gifts to charities of shares and securities, allowable business losses and qualifying interest payments. | investments into EIS and VCT |
| has a share of partnership profits of £450k, he makes gross pension contributions of £40k + pays interest of £125k loan in his name for the purposes of buying plant and machinery for the partnership. How much interest will NOT benefit from tax relief? | a. £12,500. b. £50,000. c. £75,000. d. £22,500. | £22,500. |
| Jane is a higher-rate taxpayer and has received net interest of £5,000 from her portfolio of directly held gilts. What should she declare on her annual tax return? | a. The grossed up interest. b. The amount of tax deducted. c. The unit trust provider. d. The net interest received. | d. The net interest received. |
| Amir is aged 35 and has been employed by a luxury car manufacturer since leaving school, earning £6,500 during December 2023. What will his class 1 National Insurance contributions be for this month in respect of his earnings? | a. £423.14. b. £654.24. c. £376.92. d. £491.28. | a. £423.14. |
| Ahmed is employed as a school caretaker, and also runs a small business making toys. What is the maximum he will pay on the main rate of class 1 and class 2 National Insurance contributions combined for 2023/24? | a. £3,572.40. b. £4,703.40. c. £3,393. d. £4,524. | d. £4,524. |
| Bill, aged 30, earns £1,100 per week in December 2023 as a call centre operative. What are his employer's weekly class 1 National Insurance contributions for him, assuming he is not an Armed Forces veteran? | a. £139.21. b. £127.65. c. £151.80. d. £102.96. | b. £127.65. |
| Sophie is provided with a company car valued at £10,000. What National Insurance contributions [NICs] are payable on the value of the company car? | a. Sophie will pay class 1 NICs and her employer will pay class 1A NICs. b. Sophie will have to pay class 1 NICs. c. Sophie's employer will have to pay class 1A NICs. d. Both Sophie and her employer will need to pay class 1A NICs. | c. Sophie's employer will have to pay class 1A NICs. |
| Alan is a member of an unapproved share option scheme and Gary is a member of an approved share option scheme. National Insurance contributions are: | a. payable on Gary's scheme but not Alan's. b. payable on Alan's scheme but not Gary's. c. not payable on either scheme. d. payable on both schemes. | b. payable on Alan's scheme but not Gary's. |
| Jess is a self-employed hairdresser with net profits of £15,000 for the 2023/24 tax year. What class[es] of National Insurance contributions is she subject to and how much? | a. £218.70 class 3 only. b. £291.60 class 1 only. c. £179.40 class 2 and £218.70 class 4. d. £163.80 class 2 and £300.85 class 4. | c. £179.40 class 2 and £218.70 class 4. |
| Becky, a director of her own limited company, is keen to minimise her tax liabilities so she pays herself predominantly in dividends. In order to remain entitled to contributory social security benefits, her salary must be above the: | a. upper earnings limit. b. secondary contribution threshold. c. primary contributions threshold. d. lower earnings limit | d. lower earnings limit. |
| Melanie's taxable profits from self-employment for 2023/24 are £62,000. What is Melanie's total National Insurance contribution liability for the year? | a. £3,807. b. £5,580. c. £4,448.70. d. £3,627.60. | a. £3,807. |
| B died in August, leaving a shareholding in a private company to his son Adam. The shareholding was valued on Ben's death for inheritance tax purposes. If Adam subsequently sells the shares, the acquisition cost for capital gains tax purposes will be the: | a. market value of the shares the day before his death. b. value placed on the shares for inheritance tax purposes. c. market value of the shares at the time of acquisition. d. original purchase cost of the shares. | b. value placed on the shares for inheritance tax purposes. |
| For capital gains tax purposes, an example of a capital disposal rather than a trading transaction would be: | a a forced sale to raise cash for an emergency b a transaction undertaken with the motive of realising a profit c where work is carried out on the asset to make it more marketable d the sale of an asset within a short time of its acquisition | a. a forced sale to raise cash for an emergency. |
| In June, Sandra gifted a share portfolio valued at £200,000 into a discretionary trust for her daughter Emily. This was her first lifetime gift. The gain on the portfolio at the date of disposal was £40,000. Holdover relief: | cannot be claimed coz the chargeable lifetime transfer is less than the nil rate band can be claimed and the acquisition cost to the trust £200k can be claimed and the acquisition cost to the trust £160k cannot be claimed coz the gift is a PET | can be claimed and the acquisition cost to the trust is £160,000. |
| S a higher-rate taxpayer, made a loss ten years ago on his investments of £30k, which he carried forward. In 2023/24 he made gains of £15k on his investments. What is his capital gains tax liability for 2023/24 and the amount of loss he can carry forward? | No CGT liability and £15k loss carried forward £1,800 CGT liability and £21k loss carried forward £1,800 CGT liability and £30k loss carried forward No CGT liability and £21k loss carried forward | d. No capital gains tax liability and £21,000 loss carried forward. |
| A has made gains in the 23/24 tax year: £35k on the disposal of his primary UK home, £20k on his share portfolio and £14k on the sale of directly held corporate bonds. He is a higher-rate taxpayer and has no losses available. How much CGT will he pay? | a. £12,600. b. £1,400. c. £5,600. d. £2,800 | d. £2,800. |
| Patrick, who is UK domiciled, gifted £450,000 to his wife Astrid, who is not domiciled in the UK and has no intention of being so. How much of this gift will be exempt from inheritance tax assuming he has made no previous gifts? | a. £331,000. b. £450,000. c. £55,000. d. £325,000. | a. £331,000 |
| L is married to J and both are UK domiciled. She had a portfolio of £250k shares + has just transferred 50% of her portfolio to him, 25% to her son and 25% to a local charity. For IHT purposes, ignoring the annual exemption, how much is exempt? | a. £250,000. b. £125,000. c. Nil. d. £187,500. | d. £187,500. |
| All of these are chargeable transfers for inheritance tax purposes, APART from a[n]: | a. interest-free loan of £100,000 repayable on demand or death. b. gift of £50,000 to an individual. c. transfer of £15,000 to an absolute trust. d. interest-free loan of £10,000 that is written off on death. | a. interest-free loan of £100,000 repayable on demand or death. |
| C, never married, died July23 leaving estate of £560k no property. She made a gift to a discretionary trust of £200k [after the annual exemptions] for her grandchildren in Apr18. Assuming no other gifts or reliefs, how much IHT would be due on her estate? | a. £224,000. b. £174,000. c. Nil. d. £94,000. | b. £174,000. |
| Harriet has just gifted £350,000 into a discretionary trust for her grandchildren. This is the only gift she has made during her lifetime. How much would the immediate inheritance tax liability be, assuming it is paid by the trustees? | a. £3,800. b. £7,600. c. £5,000. d. £10,000. | a. £3,800. |
| Anna, who has made lifetime gifts in excess of the nil rate band in the last seven years, would like to make a further gift of £50,000 into a discretionary trust. If she pays the inheritance tax herself, the loss to her estate will be: | a. £60,000. b. £62,500. c. £70,000. d. £83,333. | b. £62,500. |
| C, single, died leaving his home + personal effects £700k, investments £300k, share in a partnership £90k. all his assets were owned for over 5yrs, not made any previous gifts + he has no direct descendants, how much IHT would be payable on his estate? | a. £266,000. b. £306,000. c. £270,000. d. £230,000. | c. £270,000. |
| William died leaving his entire estate to his friend Sarah. The estate was worth £400k, on which inheritance tax of £34k was paid. Sarah has just died, 18 months after William, leaving an estate worth £650k. How much quick succession relief is available? | a. £27,200. b. £24,888. c. £31,110. d. £34,000. | b. £24,888. |
| Joe died in August 2023 leaving his estate worth £800,000 to his non-domiciled wife. The estate did not include a house and, assuming no other gifts or reliefs, how much UK inheritance tax, if any, would his wife have to pay? | a. £110,000. b. £190,000. c. None. d. £60,000. | d. £60,000. |
| Which of these forms of foreign income received by Patty is NOT eligible to be taxed on the remittance basis? | a. Investment income arising in Switzerland. b. Pension income from her previous employer in France. c. Income from self-employment carried on in the Republic of Ireland. d. Income from working in Belgium for a Belgian employer. | c. Income from self-employment carried on in the Republic of Ireland. |
| Which of these individuals will NOT automatically be treated as being non-resident for tax purposes? | a. Vasoulla, who is a new visitor to the UK, is spending six weeks working in London over the summer. b. Ricardo, who spends the last two weeks of March in the UK every year. c. Spencer, whose job is in Norway but he comes to the UK every month f | d. Selina, who spends 180 days in the UK every year, and the rest of the time outside the EU. |
| An individual with overseas employment income is NOT required to file a self-assessment tax return, provided that the income is: | a. subject to foreign tax and is less than £10,000. b. paid with no deduction of tax and is less than £10,000. c. subject to foreign tax and is less than the personal allowance. d. paid with no deduction of tax and is less than £11,000. | a. subject to foreign tax and is less than £10,000. |
| Sanjay was born to an Indian father and a Welsh mother. His father died when he was aged seven and they then moved to England to live. As Sanjay is now aged fifteen, what is his domicile? | a. He has the right to choose. b. Indian. c. English. d. Welsh. | b. Indian. |
| Debra has not been resident in the UK for five years but has had a forty day holiday in the UK in the current tax year. Debra should be aware that: | her uk residency for the current tax yr will depend on her domicile she is auto non-resident in the UK for current tax yr she is auto resident in the UK for current tax year her UK residency for the current tax year will depend on if she has a UK home | b. she is automatically non-resident in the UK for the current tax year. |
| Sunil has just arrived in the UK to take up employment. He has not been a resident in the UK before. What factor would NOT be taken into account in determining his residency in the UK for tax purposes? | a. Doing substantive work in the UK. b. Spending sixty days in the UK during either of the two previous years. c. Having accommodation in the UK which he has used. d. Having a spouse resident in the UK. | b. Spending sixty days in the UK during either of the two previous years. |
| Dirk is non-UK domiciled and has set up an offshore trust with no UK trustees. If Dirk can benefit from the trust, under UK anti-avoidance legislation: | a. trust income could be attributed to him. b. trust gains only could be attributed to him. c. trust income and gains are not attributed to him. d. inheritance tax on the trust could be payable by him. | a. trust income could be attributed to him. |
| T both lives and runs his own business in France, having done so for the last 4 years. Also earns £20K pa for 15 days consultancy work in UK, also receiving an additional £1,500 pa in investment income from UK gilts. His UK related income is: | a. subject to income tax, regardless of Toby's residence. b. subject to income tax as Toby is resident in the UK. c. not subject to income tax as Toby is not resident in the UK. d. not subject to income tax, regardless of Toby's residence. | c. not subject to income tax as Toby is not resident in the UK. |
| Trevor has noticed that he made an error on his self-assessment tax return for 2022/23. What is the latest date that Trevor can notify HMRC of an amendment to his return? | a. 6 April 2024. b. 31 January 2025. c. 6 April 2025. d. 31 January 2024. | b. 31 January 2025. |
| M, who is self-employed, had an income tax liability of £14k for 22/23. His income tax liability for 23/24 is £20k and he also has a capital gains tax liability from the sale of a share portfolio of £4k Malcolm's balancing payment on 31 January25 will be: | a. £20,000. b. £4,000. c. £6,000. d. £10,000. | d. £10,000. |
| Emily is self-employed and has calculated that her income tax liability is £25,000 for 2022/23 and £35,000 for 2023/24. How much income tax will she pay on 31 January 2025? | a. £12,500. b. £25,000. c. £27,500. d. £17,500. | c. £27,500. |
| Geoff is employed and has calculated that for 2023/24 he has underpaid income tax of £2,500. He can arrange for this to be collected via his PAYE coding, provided he files his return on paper by: | a. 31 October 2024 or online by 30 December 2024. b. 31 October 2024 or online by 31 January 2025. c. 31 October 2023 or online by 31 January 2024. d. 30 December 2024 or online by 31 January 2025. | a. 31 October 2024 or online by 30 December 2024. |
| Camilla has just made these investments: £10,000 in a UK-domiciled exchange-traded fund, £10,000 in a unit trust and £10,000 in FTSE 100 company shares. Her stamp duty reserve tax liability is: | a 0 for the ETF, 0 for the unit trust and 50 for FTSE 100 b 0 for the ETF, 50 for the unit trust and nil for FTSE 100 c 50 for the ETF, 50 for the unit trust and nil for FTSE 100 d 0 for the ETF, 50 for the unit trust and 50 for FTSE 100 | a. nil for the exchange-traded fund, nil for the unit trust and £50 for the FTSE 100 shares. |
| Who is normally responsible for paying the stamp duty reserve tax to HMRC following the purchase of shares? | a. The seller. b. The broker acting for the seller. c. The purchaser. d. The broker acting for the purchaser. | d. The broker acting for the purchaser. |
| John, who is based in Lancashire, is buying his first home for £285,000 and an office for his business for £525,000. How much stamp duty land tax is payable in total on the two properties? | a. £25,250. b. £15,750. c. £20,000. d. £34,250. | b. £15,750. |
| Anita purchased shares valued at £16,300 via her stockbroker. How much stamp duty reserve tax, if any, will be payable on this transaction? | a. £82. b. Nil. c. £81.50. d. £85 | c. £81.50. |
| Tina buys ordinary shares in London Bank PLC costing £1,248 through her stockbroker's nominee service. How much stamp duty reserve tax will be payable on this transaction? | a. £10. b. £12.48. c. £6. d. £6.24. | d. £6.24. |
| Bernie is buying his main residence in Birmingham for £1m and Howie is buying a nearby non-residential property for the same price. Who will pay more stamp duty land tax, and by how much? | a. Bernie will pay £4,250 more than Howie. b. Bernie will pay £1,750 more than Howie. c. Howie will pay £4,250 more than Bernie. d. Howie will pay £1,750 more than Bernie. | b. Bernie will pay £1,750 more than Howie. |
| Giles purchased shares valued at £12,500 via his stockbroker. How much stamp duty reserve tax, if any, will be payable on this transaction? | a. £65. b. £62.50. c. Nil. d. £63. | b. £62.50. |
| T wants to buy a house to live in for £350k + a BTL for £165k to rent to his nephew. he is NOT a first-time buyer and that he intends to keep both properties for the long term, how much SDTL will he pay if he buys the more expensive property first? | a. £13,250. b. £5,000. c. £15,500. d. £9,950 | d. £9,950. |
| Penny buys a residential property in Oxford for £1.17m that includes £30,000 for fittings. Assuming this is Penny's first and only property, how much stamp duty land tax is payable on the transaction? | a. £58,250. b. £57,750. c. £55,250. d. £60,750. | c. £55,250. |
| What tax is payable on the transfer of a unit trust valued at £5,000? | a. Stamp duty reserve tax, rounded up to the nearest penny. b. Stamp duty, rounded up to the nearest penny. c. Stamp duty, rounded up to the nearest £5. d. Stamp duty reserve tax, rounded up to the nearest £5. | c. Stamp duty, rounded up to the nearest £5. |
| Tradeworth Ltd has been advised that it can elect to complete an annual VAT return. This means that: | a. its taxable supplies are greater than £1.35m in a year. b. it will pay the VAT due in twelve monthly instalments. c. it will pay the VAT due at the end of the year. d. its taxable supplies are £1.35m a year or less. | d. its taxable supplies are £1.35m a year or less |
| Registered traders will typically submit VAT returns and pay any VAT due every: | a. three months. b. month. c. six months. d. year. | a. three months. |
| Julie has earned income of £13,000 and interest from savings of £6,000. She has no other income or reliefs. How much income tax, if any, will she pay on her savings interest? | a. £86. b. £430. c. £1,000. d. £100. | a. £86. |
| Victor, a UK investor, has money in a bank account in the Channel Islands. He has not agreed for the bank to disclose details of the account to HMRC. The consequences of this are likely to be that: | tax deducted cannot be offset against UK tax liability the interest will escape tax if the money remains offshore for seven years he will be taxed at the higher rate regardless of his tax status withholding tax is deducted from interest payments | d. withholding tax is deducted from interest payments. |
| In 2023/24, Victoria has made gains of £20,000 on her share portfolio and £5,000 on some corporate bonds. She also made a loss on UK gilts of £4,000. As a higher-rate taxpayer, if she made no other gains or losses, what is her capital gains tax liability? | a. £2,000. b. £3,000. c. £3,800. d. £2,800. | d. £2,800. |
| Under replacement of domestic items relief, a lessor of a furnished residential property may claim a deduction against taxable profits for the replacement of all of the following, APART from a: | a. washing machine. b. bed. c. dining table. d. bath. | d. bath. |
| H high-rate, has gilts left to him by his dad. H has utilised his personal savings allowance + has elected to receive interest from his gilts net of 20% income tax. For 23/24 he received an interest payment of £208. What additional income tax is due? | a. £52. b. £83.20. c. £104. d. £41.60. | a. £52. |
| A letting property business that purchases plant and machinery will normally qualify for: | a. the annual investment allowance up to £1m. b. the annual investment allowance on the full amount of the expenditure. c. corporation tax relief on the full amount of the expenditure. d. corporation tax relief up to £1m. | a. the annual investment allowance up to £1m. |
| A gain on the disposal of an asset is made on 1 June 2023. The capital gains tax liability for this disposal can be deferred if the gain is reinvested into an enterprise investment scheme, provided the reinvestment takes place between: | a. 1 June 2022 and 31 May 2025. b. 1 June 2023 and 31 May 2025. c. 1 June 2022 and 31 May 2026. d. 1 June 2023 and 31 May 2026. | c. 1 June 2022 and 31 May 2026. |
| T + J have 2 kids: E, who was born in Mar 09, and Chloe, who was born in July 11. Assuming that Ethan's Child Trust Fund has not been transferred to a Junior ISA, what is the maximum investment that can be made into Junior ISAs for the children in 23/24? | a. £18,000. b. £13,500. c. £9,000. d. £27,000. | c. £9,000. |
| A non-qualifying UK life policy fund pays income tax on interest and property rental income: | a. and UK dividend income at the rate of 10%. b. and UK dividend income at the rate of 20%. c. at the rate of 10% and at the rate of 20% on UK dividend income. d. at the rate of 20% with UK dividend income being exempt. | d. at the rate of 20% with UK dividend income being exempt. |
| May 23, A gifted £50k into an absolute trust for her grandson, Alf, who is 12. The £50k was invested into a non-qualifying UK life assurance policy. In the event of the policy being surrendered, any income tax liability on a gain will be the liability of: | a. Alfie. b. The trustees. c. Alice. d. Alice until Alfie reaches the age of 18 and Alfie thereafter. | a. Alfie. |
| If a higher-rate taxpayer owns shares in an offshore closed-ended investment company, this means that: | investment cannot be held within an ISA gains in encashment are exempt CGT income is treated as savings income + is taxable but subject to personal savings allowance dividends received gross + are taxable but subject to dividend allowance of £1k | d. dividends are received gross and are taxable but subject to the dividend allowance of £1,000. |
| George died on 1 November 2023 and the beneficiaries of his will want to change it to reduce the inheritance tax liability that has arisen. To achieve this, they must enter into a deed of variation no later than 31 October: | a. 2027. b. 2026. c. 2024. d. 2025. | d. 2025. |
| Jake, a higher-rate taxpayer, receives earned income and dividend income. If he makes a personal pension contribution in 2023/24 that results in his dividend income being removed from the higher-rate tax bracket, the effective rate of tax relief will be: | a. 45%. b. 40%. c. 22.5%. d. 33.75% | a. 45%. |
| Imran is aged 68 and although he could retire, he has decided to continue working on a self-employed basis. What National Insurance contributions, if any, would he have to pay? | a. Class 4 [if his profits are high enough]. b. Class 2 only. c. Class 2 and class 4 [if his profits are high enough]. d. None. | d. None. |
| 6 Apr 23, an additional-rate invested £10k into his 10 year old son's savings account. savings account pays a gross rate of interest 2.5%. How much income tax, if any, will be payable on the interest, assuming that the son has no other income in 23/24? | a. Nil. b. £12.50. c. £50. d. £112.50. | d. £112.50. |
| Brian would like to make a personal pension contribution in 2023/24 for his wife Pamela whose only income is investment income of £2,000 gross. What is the maximum net contribution he can make if the entire contribution is to be eligible for tax relief? | a. £2,000. b. £4,500. c. £2,880. d. £3,600. | c. £2,880. |
| Oliver, who is aged 45, has total earned income of £116,210 for 2023/24. How much more income tax will Oliver pay in 2023/24 compared to someone of the same age with total earned income of £100,000? | a. £9,726. b. £7,387. c. £8,105. d. £6,484. | a. £9,726. |
| Basil died several years ago when the nil rate band was £300,000. He left £100,000 to his daughter and the balance to Susan his wife. To the nearest pound, how much transferable nil rate band would Susan be able to claim? | a. £216,667. b. £200,000. c. £325,000. d. £108,333. | a. £216,667. |
| Li Jing made a gift of £50,000 to her son in June 2023, having made no other lifetime gifts. The most appropriate life assurance policy for her to cover any potential inheritance tax liability on her estate would be a seven year: | decreasing term assurance policy with an initial sum of £50k level term assurance policy with an initial sum assured of £17,600 decreasing term assurance policy with a sum assured of £17,600 level term assurance policy with a sum assured of £50k | b. level term assurance policy with an initial sum assured of £17,600. |
| Amy, aged 15 and a non-taxpayer, is the beneficiary of a discretionary trust set up by her grandparents. If she receives an annual income of £1,000 from the trust, how much income tax can Amy reclaim on this income? | a. £100. b. £727. c. £818. d. £200. | c. £818. |
| Ian and Ruth are married with a young child. Ian has 'adjusted net income' of £30,000, and Ruth has 'adjusted net income' of £53,400 a year. What, if any, is the effective percentage reduction in the amount of child benefit that they receive? | a. 68%. b. Nil. c. 17%. d. 34%. | d. 34%. |
| Hazel received a gift of £100k in May 2023. She has fully utilised her ISA allowance for 2023/24 and would like to invest the £100k in a tax-efficient manner. If she has a total income of £7,500, the most tax efficient investment for Hazel would be a[n]: | a. deposit account. b. equity unit trust. c. endowment policy. d. non-qualifying UK life assurance policy. | a. deposit account. |
| Natasha has shares in a company which she sells on 1 September 2023. If she does not want to create a gain or loss for capital gains tax purposes, she must repurchase the shares by: | a. 30 September 2023. b. 30 October 2023. c. 14 October 2023. d. 14 September 2023 | a. 30 September 2023. |
| higher-rate taxpayer, bought a holiday cottage for £85k 20 yrs ago. added a conservatory 10 yrs ago for £7k and sold the cottage Sept 23 for £152k. Costs associated with purchase £500 and £3k with sale. What is CGT liability. | a. £10,100. b. £14,140. c. £17,080. d. £12,200. | b. £14,140. |
| Liam is moving within England and has bought a bigger house for £525,000. The value of the property is £495,000 and the previous owner leaves furniture and appliances valued at £30,000. How much stamp duty land tax will Liam have to pay? | a. £16,250. b. £13,750. c. £12,250. d. £14,750. | c. £12,250. |
| ABB Ltd makes up one set of accounts from 1 January 2023 to 31 March 2024. On what accounting period[s] will corporation tax be charged? | a. From 1/1/23 to 31/9/23 followed by 1/10/23 to 31/3/24 b. From 1/1/23 to 31/3/23 followed by 1/4/23 to 31/3/24 c. From 1 January 2023 to 31 March 2024 d. From 1 January 2023 to 31 December 2023 followed by 1 January 2024 to 31 March 2024 | d. From 1 January 2023 to 31 December 2023 followed by 1 January 2024 to 31 March 2024. |
| What expenses can be deducted from a company's profits when calculating corporation tax? | a. Depreciation on buildings. b. Depreciation on plant and machinery. c. Charitable donations. d. Entertaining expenses | c. Charitable donations |
| Sian runs her own limited company and has decided to voluntarily register for VAT. The most likely reason for this is that she can: | a. claim input tax on her purchases. b. use VAT to reduce her corporation tax liability. c. use VAT to reduce her income tax liability. d. claim output tax on her purchases. | a. claim input tax on her purchases. |
| Blue Consulting Ltd's CEO is Petra. She has assembled a team of eight company directors who own 100% of the shares. This is known as a[n]: | a. close company. b. public company. c. investment company. d. enterprise investment scheme. | a. close company. |
| Jules is unable to pay his £70,000 tax by the 31 January 2024 deadline. Under the self-assessment system, he will receive a: | a. £3,500 penalty if he pays his tax on 6 March 2024. b. £3,500 penalty if he pays his tax on 28 February 2024. c. £1,050 penalty if he pays his tax on 28 February 2024. d. £1,750 penalty if he pays his tax on 6 March 2024. | a. £3,500 penalty if he pays his tax on 6 March 2024. |
| Trevor has noticed that he made an error on his self-assessment tax return for 2022/23. What is the latest date that Trevor can notify HMRC of an amendment to his return? | a. 6 April 2024. b. 31 January 2025. c. 6 April 2025. d. 31 January 2024. | b. 31 January 2025. |
| Gillian, who does not normally receive a self-assessment tax return, surrendered an investment bond in July 2023, which resulted in an additional income tax liability. By what date must she notify HMRC that she has further tax to pay? | a. 6 April 2024. b. 5 April 2025. c. 31 January 2025. d. 5 October 2024. | d. 5 October 2024. |
| An employer failed to pay HMRC money PAYE and National Insurance contributions on two occasions during 2023/24. Both times the payment was two months late. What penalty will be incurred for the second late payment, which was for an amount due of £68,500? | a. £6,850. b. £1,370. c. £3,290. d. £685 | d. £685. |
| Becky, a director of her own limited company, is keen to minimise her tax liabilities so she pays herself predominantly in dividends. In order to remain entitled to contributory social security benefits, her salary must be above the: | a. lower earnings limit. b. upper earnings limit. c. primary contributions threshold. d. secondary contribution threshold. | a. lower earnings limit. |
| Alan is a member of an unapproved share option scheme and Gary is a member of an approved share option scheme. National Insurance contributions are: | a. payable on Alan's scheme but not Gary's. b. payable on Gary's scheme but not Alan's. c. payable on both schemes. d. not payable on either scheme. | a. payable on Alan's scheme but not Gary's |
| Ahmed is employed as a school caretaker, and also runs a small business making toys. What is the maximum he will pay on the main rate of class 1 and class 2 National Insurance contributions combined for 2023/24? | a. £4,524. b. £3,572.40. c. £4,703.40. d. £3,393. | a. £4,524. |
| Amir is aged 35 and has been employed by a luxury car manufacturer since leaving school, earning £6,500 during December 2023. What will his class 1 National Insurance contributions be for this month in respect of his earnings? | a. £654.24. b. £423.14. c. £491.28. d. £376.92. | b. £423.14. |
| Which of these individuals will NOT automatically be treated as being non-resident for tax purposes? | a new visitor to the UK, is spending 6 weeks working London 180 days in the UK every year + the rest of the time outside the EU job is in Norway but he comes to the UK every month for 2 days spends the last 2 weeks of Mar in the UK every year | b. Selina, who spends 180 days in the UK every year, and the rest of the time outside the EU. |
| Which of these forms of foreign income received by Patty is NOT eligible to be taxed on the remittance basis? | a. Income from self-employment carried on in the Republic of Ireland. b. Pension income from her previous employer in France. c. Income from working in Belgium for a Belgian employer. d. Investment income arising in Switzerland. | a. Income from self-employment carried on in the Republic of Ireland. |
| Patrick, who is UK domiciled, gifted £450,000 to his wife Astrid, who is not domiciled in the UK and has no intention of being so. How much of this gift will be exempt from inheritance tax assuming he has made no previous gifts? | a. £325,000. b. £55,000. c. £331,000. d. £450,000. | c. £331,000. |
| All of these are chargeable transfers for inheritance tax purposes, APART from a[n]: | a. transfer of £15,000 to an absolute trust. b. gift of £50,000 to an individual. c. interest-free loan of £100,000 repayable on demand or death. d. interest-free loan of £10,000 that is written off on death. | c. interest-free loan of £100,000 repayable on demand or death. |
| Harriet has just gifted £350,000 into a discretionary trust for her grandchildren. This is the only gift she has made during her lifetime. How much would the immediate inheritance tax liability be, assuming it is paid by the trustees? | a. £10,000. b. £7,600. c. £5,000. d. £3,800. | d. £3,800. |
| unmarried and never owned his own house, died in June leaving an estate of £500k. In the 7 years prior to his death, he made chargeable lifetime transfers totalling £150k. How much of the nil rate band remains to be applied to Thomas' estate on his death? | a. £350,000. b. £325,000. c. £175,000. d. £150,000. | c. £175,000. |
| A has made gains in the 23/24 tax year: £35k on the disposal of his primary UK home, £20k on his shares + £14k on the sale bonds. He is a higher-rate taxpayer and has no losses available to offset. How much capital gains tax will he pay? | a. £12,600. b. £5,600. c. £2,800. d. £1,400. | c. £2,800. |
| S, a higher-rate taxpayer, made a loss ten years ago on his investments of £30k, which he carried forward. In 23/24 he made gains of £15k on his investments. What is his capital gains tax liability for 23/24 and the amount of loss he can carry forward? | a No capital gains tax liability and £15k loss carried forward b No capital gains tax liability and £21k loss carried forward c £1,800 capital gains tax liability and £21k loss carried forward d £1,800 CGT liability and £30k loss carried forward | b. No capital gains tax liability and £21,000 loss carried forward. |
| Amir, a higher-rate taxpayer, made a capital gain of £40k following the sale of a second residential property in Aug23. He has no other gains or losses to take into account. How much will Amir's capital gains tax liability be and when must it be paid? | a £9,520 and this full amount must be paid within 60 days from exchange of contract b £9,520 by 31 January 2025 c £9,520 and a payment on account must be made within 60 days from the completion date d £5,040 on 31 Jan25 + £5,040 on 31 July 2025 | c. £9,520 and a payment on account must be made within 60 days from the completion date. |
| Saul is self-employed and a higher-rate taxpayer. He makes a profit of £15,000 from his buy-to-let properties. When preparing his accounts for the current tax year, what dates must be used and how much tax is due on these profits? | £2,850 corporation tax for the period which must end 31 Mar or 5 Apr £2,850 corporation tax for the period which must end 31 January or 6 Apr £6k income tax for the period which must end 31 Mar or 5 Apr £6k income tax which must end 6 Apr or 31 Oct | c. £6,000 income tax for the period which must end 31 March or 5 April. |
| A letting property business that purchases plant and machinery will normally qualify for: | a. the annual investment allowance on the full amount of the expenditure. b. corporation tax relief on the full amount of the expenditure. c. corporation tax relief up to £1m. d. the annual investment allowance up to £1m. | d. the annual investment allowance up to £1m. |
| S who earns £35ka has shares in ABC and opts to receive new shares instead of a cash dividend. The market value of the new shares that he receives is £800. If his dividend allowance is already fully utilised, how much income tax will S pay on the shares? | a. £160. b. Nil. c. £70. d. £60. | c. £70. |
| Sadia, who is an additional-rate taxpayer, received her only dividends totalling £11,360 from her share portfolio in 2023/24. What income tax is she liable to pay on this income? | a. £4,076.66. b. £3,496.50. c. £4,470.16. d. £3,834. | c. £4,470.16. |
| Under replacement of domestic items relief, a lessor of a furnished residential property may claim a deduction against taxable profits for the replacement of all of the following, APART from a: | a. bath. b. washing machine. c. dining table. d. bed. | a. bath. |
| Julie has earned income of £13,000 and interest from savings of £6,000. She has no other income or reliefs. How much income tax, if any, will she pay on her savings interest? | a. £100. b. £430. c. £86. d. £1,000. | c. £86. |
| Jane is a higher-rate taxpayer and has received net interest of £5,000 from her portfolio of directly held gilts. What should she declare on her annual tax return? | a. The grossed up interest. b. The amount of tax deducted. c. The net interest received. d. The unit trust provider. | c. The net interest received. |
| Sally is aged 32 and self-employed. In 2023/24 she has profits assessable to tax of £55,000 and she also makes a gross personal pension contribution of £3,000. What is Sally's income tax liability? | a. £9,472. b. £8,832. c. £9,432. d. £8,232. | b. £8,832. |
| Lesley bought a painting in May 2010 for £2,500 and sold it for £7,200 in June 2023. What is the gain, if anything, for capital gains tax purposes? | a. £4,700. b. £2,000. c. £1,200. d. Nil. | b. £2,000. |
| Wang Jin is 40 years old and an employee who is paid monthly. She earns £4,500 during December 2023. What amount of employee's class 1 National Insurance contributions are payable for December 2023? | a. £426.29. b. £383.14. c. £413.26. d. £376.92. | b. £383.14. |
| With regard to Inheritance Tax, a necessary condition for satisfying the normal expenditure rule for exempt lifetime transfers is that the payments | A. must not exceed £3,000 per annum. B. must not reduce the transferor’s standard of living. C. must be agreed in advance with HM Revenue & Customs. D. may only be made to family members. s. | B. must not reduce the transferor’s standard of living. |
| moved to the UK, having NOT been resident in the UK during the previous 3y. She has 3 UK ties. What minimum number of days will she need to reside in the UK during the tax year 2023/2024 to be regarded as a resident for that year? | A. 16 B. 46 C. 91 D. 121 | C. 91 |
| A limited company with a turnover of £500,000 has a trading year which ends on 30 June. According to HM Revenue & Customs, by which date should the company normally pay any Corporation Tax due? | A. 1 October the same year. B. 1 February the following year. C. 1 April the following year. D. 5 April the following year. | C. 1 April the following year. |
| Imogen purchased some eligible securities on AIM using a stock transfer form, sold some FTSE 100 shares through CREST and bought some gilts. To which stamp duty(ies), if any, was she liable? | A. None. B. Stamp Duty only. C. Stamp Duty Reserve Tax only. D. Stamp Duty and Stamp Duty Reserve Tax. | A. None. |
| An investment portfolio with an acquisition value of £220,000 was subsequently disposed of for £248,000, without incurring a Capital Gains Tax liability. This was because | A the disposal was made by trustees. B Inheritance Tax had already been paid on the acquisition value. C the portfolio consisted totally of gilts and VCT shares purchased at issue D the portfolio consisted totally of Real Estate Investment Trust shares | C. the portfolio consisted totally of gilts and Venture Capital Trust shares purchased at issue. |
| 23/24, he savings income of £1k from his UK building society account + £1k from his offshore bank which he leaves to accumulate offshore. His total income for the tax year is £90k What is his Income Tax liability on his total savings income? | A. £200 B. £400 C. £600 D. £800 | C. £600 |
| gross annual income of £58k in 23/24, is accessing for the 1st time part of his only pension, which is a personal pension, using an UFPLS. He is withdrawing £42k. What is the total amount of Income Tax, payable as a result of this withdrawal? | A. Nil. B. £6,300 C. £12,600 D. £16,800 | C. £12,600 |
| owned a second house as a joint tenant with his daughter Miranda. They purchased it 10y ago, each paying 50% to purchase. On death, the house was £900k. All his other assets were solely in his name and were bequeathed to his wife. What IHT, was due? | A. Nil. B. £50,000 C. £180,000 D. £230,000 | B. £50,000 |
Created by:
MaxHaigh