Friday Five – 21 September – 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.
These questions relate to examinable tax year 2018/19, examinable until 31 August 2019.
- How does the use of trusts help mitigate an IHT liability?
- Trusts ensure that assets are paid in accordance with the donor’s wishes thereby avoiding IHT
- Placing investments in trust can reduce the value of the estate
- A regular premium life policy in trust allows clients to use their nil rate band
- Single premium life policies placed in trust are immediately exempt from IHT
- As a financial adviser, which of the following individuals would you advise if possible to pay Class 3 National Insurance Contributions? Tick all that apply.
- Jane, who took early retirement at 50 having established 32 years of NICs
- Peter, aged 67, with an inadequate NIC record to qualify for a full State pension
- Hayley, who is moving to Portugal for a year, after selling the UK-based business she owned for 10 years
- Mary, who has an incomplete NIC record after taking the last 2 years off to study
- Which of the following risks would apply to the drawdown pension option your client is entering into? Tick all that apply.
- The underlying annuity rate will increase during period of deferral in drawdown.
- Potentially high charges for administration/reviews.
- The value of the fund can go down as well as up.
- Depletion of fund through high-income withdrawals.
- John is paying regular monthly premiums on a life assurance policy to protect a potential inheritance tax liability. Which of the following exemptions from inheritance tax could he claim against the annual premiums totalling £3,200?
- The annual exemption and the normal expenditure out of income
- The annual exemption only
- The small gifts exemption
- The life assurance premium exemption
- What is the running yield of 5% Treasury Stock 2020 priced at £110.25?
- B – See R01 Study Text, Chp 2
Grab our taster mock exam paper for CII R01. Click here to download.
- ACD – See R03 Study Text, Chp 2
Grab our taster mock exam paper for CII R03. Click here to download.
- BCD – See R04 Study Text, Chp 6:2
Grab our taster mock exam paper for CII R04. Click here to download.
- A – See R05 Study Text, Chp 5
Grab our taster mock exam paper for CII R05. Click here to download.
- C – See J10 Study Text, Chp 9
Grab our taster mock exam paper for CII J10. 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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