Friday Five – 15 June – 5 Questions in 5 Minutes
Last updated on September 25th, 2019 at 4:20 am
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
IMPORTANT! These questions relate to examinable tax year 2017/18, examinable by the CII until 31 August 2018. They do not relate to tax year 2018/19 which is only examinable by the CII from 1 September 2018.
- Under ICOBS rules, who is responsible for ensuring an intermediary is authorised to deal with an insurer?
- The responsibility lies solely with the intermediary
- An insurer must ensure that any intermediary it deals with is authorised
- An intermediary would not be able to contact an insurer unless they were authorised
- It is solely the FCA’s responsibility to ensure all intermediaries are authorised
- An investment has a high standard deviation around the expected return. This tells us that the investment:
- would be classed as low risk
- has low correlation with other asset classes
- is producing returns broadly in line with expectations
- would be considered volatile and risky
- Lenny owns an 80% share in the family company and on his daughter Freya’s 21st birthday gives her a 20% shareholding. Instead of paying Capital Gains Tax (CGT) on the gain of £50,000 he has made, Lenny instead claims holdover relief. What is the impact of this course of action?
- There is no impact on Freya but if she disposes of the shares Lenny will then have to pay the outstanding CGT
- Holdover relief extinguishes Lenny’s CGT liability and Freya acquires the shares at the value at the time they are transferred to her
- There is no impact on Freya but if she disposes of the shares Lenny will then have to pay the CGT but at the reduced holdover rate of 10%
- Freya acquires the shares at Lenny’s acquisition cost and if she disposes of the shares her gain will include Lenny’s gain of £50,000
- Caroline died aged 66 with uncrystallised funds valued at £1,600,000. What is the lifetime allowance charge (if any) if benefits over the lifetime allowance are paid as a dependant’s lifetime annuity within two years of her death?
- No charge.
- £192,500.
- £150,000.
- £87,500.
- Who of the following would be eligible for Statutory Sick Pay?
- Philip, employed part-time and not paying any National Insurance contributions
- Steven, self-employed and paying Class 2 and Class 4 National Insurance contributions
- Brenda, currently on a career break and paying Class 3 National Insurance contributions
- Miriam, employed and paying Class 1 National Insurance contributions
Answers
- B – See R01 Study Text, Chp 5:2
Grab our taster mock exam paper for CII R01. Click here to download.
- D – See R02 Study Text, Chp 3
Grab our taster mock exam paper for CII R02. Click here to download.
- D – See R03 Study Text, Chp 3
Grab our taster mock exam paper for CII R03. Click here to download.
- C – See R04 Study Text, Chp 2:2
Grab our taster mock exam paper for CII R04. Click here to download.
- D – See R05 Study Text, Chp 3
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?
Do let us know by leaving a comment below – we promise to read them all. (Humour particularly appreciated on a Friday!)
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