Friday Five – 17 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 2017/18, examinable until 31 August 2018.

1. How is the Financial Conduct Authority funded?
   1. Through taxes distributed by the Government
   2. Through levies on the financial services industry
   3. Through fines and penalties imposed when an authorised firm breaches rules
   4. Through charges applied to large firms e.g. banks and building societies

2. Which are the main indices used when assessing US stocks? Tick all that apply.
   1. The Dow Jones Industrial Average
   2. Topix
   3. Standard & Poor’s (S&P) Composite
   4. The NASDAQ Composite
   5. DAX 30

3. Scarlett was born in Spain but has been employed as a teacher in a local language school which means she has become a UK resident for this tax year. Which of the following applies to Scarlett in relation to how her income from the school is taxed?
   1. As a non-UK domicile she will be taxed on the remittance basis
   2. As a non-UK domicile she can elect to be taxed on the remittance basis
   3. As the UK has a double taxation agreement with Spain UK tax is waived
   4. As a UK resident and as the income arises in the UK it is fully taxable.

4. James makes a lifetime gift into a trust which isn’t an absolute/bare or disabled trust. How much tax is due immediately?
   1. 20% on the amount gifted into trust
   2. 20% on the amount gifted into trust that exceeds the available nil rate band
   3. 40% on the amount gifted into trust that exceeds the available nil rate band
   4. 40% on the amount gifted into trust

5. Albert, a widower aged 68, dies in June 2017 leaving an annuity protection lump sum death benefit of £60,000 to his daughter, Kirsten. How much will Kirsten receive in December 2017 after any tax payable is deducted?
   1. £0.
   2. £27,000.
   3. £33,000.
   4. £60,000.

Answers

1. B – 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 1:2
   Grab our taster mock exam paper for CII R02. Click here to download.

3. D – See R03 Study Text, Chp 5
   Grab our taster mock exam paper for CII R03. Click here to download.

4. B – See R05 Study Text, Chp 2
   Grab our taster mock exam paper for CII R05. Click here to download.

5. D – See R08 Study Text, Chp 1
   Grab our taster mock exam paper for CII R08. 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!)