Friday Five – 1 November – 5 Questions in 5 Minutes

Welcome to this week’s Friday Five – 5 Questions in 5 Minutes Every Friday

What’s this all about?

It’s a bit of Friday Fun where we provide you with 5 questions relevant to a mix of CII exams. The challenge is for you to answer them in 5 minutes. Answers at the bottom of the page.

Questions

These questions relate to examinable tax year 2019/20, examinable until 31 August 2020.

1. Under which of the following would it NOT be required to disclose your status?
   1. E-mail
   2. Fax
   3. Text message
   4. Letter

2. What components are taken into account when determining a bid/offer spread? Tick all that apply.
   1. Dealing costs
   2. Accrued income
   3. Underlying market spread
   4. Manager’s initial charge

3. Sandy and Brian are carrying out Inheritance Tax mitigation and are keen to use the ‘normal expenditure out of income’ exemption. Which of the following is most likely to qualify?
   1. Paying net annual premiums of up to £2,880 into a personal pension for their son from spare income
   2. Paying a £45,000 deposit on a house purchase for their daughter
   3. Using the 5% withdrawal facility from an investment bond to pay the premiums on a joint life 2nd death life policy
   4. Transferring their income-producing investment portfolio to both children

4. John has a defined contribution AVC whereas Tom’s AVC is on an “added years” basis. In which area, will Tom’s arrangement differ from John’s?
   1. Tax relief on contributions.
   2. Some of the benefit can be in the form of tax-free cash.
   3. Minimum pension age.
   4. Inability to draw the benefit independent of the main scheme.

5. Where a claim is made under a mortgaged life policy, who will the life office make the payment to?
   1. The policyholder
   2. The mortgagee
   3. The mortgagor
   4. The life assured

Answers

1. C – See R01 Study Text, Chp 5:2
   Grab our taster mock exam paper for CII R01. Click here to download.

2. ACD – See R02 Study Text, Chp 6:1
   Grab our taster mock exam paper for CII R02. Click here to download.

3. A – See R03 Study Text, Chp 11
   Grab our taster mock exam paper for CII R03. Click here to download.

4. D – See R04 Study Text, Chp 4
   Grab our taster mock exam paper for CII R04. Click here to download.

5. B – See R05 Study Text, Chp 4
   Grab our taster mock exam paper for CII R05. Click here to download.

How did you find this week’s questions? Did you complete them in 5 minutes? Did you get them all correct? Do you disagree with any?

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