Friday Five – 26 January – 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. Which of the following are Data Protection Principles? Tick all that apply.
   1. Personal data should be accurate and where necessary kept up to date
   2. Personal data should be kept indefinitely
   3. Personal data must be available to other organisations at their request
   4. Personal data should only be obtained for a specific lawful purpose
   5. Personal data should be adequate, relevant and not excessive

2. The Capital Asset Pricing Model (CAPM) provides the relationship between a security’s systematic risk and its expected return so that:
   1. securities with a low beta would provide the highest returns
   2. securities with high beta can be expected to provide a higher return
   3. non-systematic risk can be eliminated through diversification
   4. the risk premium can be determined

3. Which of the following fully qualifies as an exempt transfer for Inheritance Tax purposes? Tick all that apply.
   1. Hayley made a gift to a friend of £3,250 using her annual exemption and the small gift exemption
   2. Caroline made a transfer of £2,750 last year and would like to use her unused exemption from last year and this year’s exemption to cover a total gift of £3,250
   3. Hayden made a gift of £75,000 to his wife although they are separated and no longer live together
   4. Thomas made his first gift of £75,000 to his wife. He is UK domiciled and she is not.

4. In assessing her eligibility for State Pension Credit, Molly has declared savings of £14,000. This means that, on this information alone, she will:
   1. be unable to claim any Pension Credit.
   2. be assumed to have, from own sources, a weekly income of £8.
   3. be assumed to have, from own sources. a weekly income of £14
   4. be assumed to have, from own sources, a weekly income of £28.

5. Helen has made a chargeable gain of £4,500 on the surrender of her non-qualifying life assurance policy. If her taxable income in 2017/2018 is £40,000 she will be liable for which of the following taxes on the gain?
   1. Capital gains tax at 10%
   2. Capital gains tax at 20%
   3. Income tax at 20%
   4. Income tax at 40%

Answers

1. ADE – See R01 Study Text, Chp 6
   Grab our taster mock exam paper for CII R01. Click here to download.

2. B – See R02 Study Text, Chp 3
   Grab our taster mock exam paper for CII R02. Click here to download.

3. BCD – See R03 Study Text, Chp 4
   Grab our taster mock exam paper for CII R03. Click here to download.

4. B – See R04 Study Text, Chp 7
   Grab our taster mock exam paper for CII R04. Click here to download.

5. C – See R05 Study Text, Chp 5
   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!)