Friday Five – 27 April – 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.
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 the ‘lighter touch’ regime for Stakeholder products what advice would a client NOT be able to receive from a basic adviser?
- Minimum investment limits
- Cancellation rights
- Fund suitability
- Product charges
- Which one of these terms describes how a gilt could be classified based on its time until redemption?
- Mid term
- Average term
- Lisa has recently made a £100,000 gain on selling her buy to let home. She is now considering whether to reinvest this in an Enterprise Investment Scheme (EIS). Which of the following would be a benefit to Lisa of doing this?
- She can defer the original gain until she disposes of the EIS shares
- 50% of the original gain will be exempt from tax
- Any subsequent gain would be taxed at a lower rate on disposal
- This will reduce the base cost of the EIS shares by the original gain
- Karen has a combined life assurance and critical illness policy. What will happen to the sum assured on death if she makes a claim on the diagnosis of a critical illness?
- It will continue at the original amount for a maximum of five years
- It will continue at half the original amount
- It will only continue to exist if Karen survives for a minimum of two years
- It will not exist as the policy has paid out an accelerated death payment
- Darcey is a member of a defined benefit scheme. She would like to transfer her benefits of £60,000 to a money purchase scheme to take advantage of pension flexibility. Before she can do this, she must:
- wait until her benefits are valued at more than £100,000.
- receive independent advice from an FCA-authorised adviser.
- take the 25% tax free lump sum.
- wait until she has been a member of the scheme for 3 years.
- C – See R01 Study Text, Chp 7
Grab our taster mock exam paper for CII R01. Click here to download.
- B – See R02 Study Text, Chp 1:1
Grab our taster mock exam paper for CII R02. Click here to download.
- A – See R03 Study Text, Chp 3
Grab our taster mock exam paper for CII R03. Click here to download.
- D – See R05 Study Text, Chp 7
Grab our taster mock exam paper for CII R05. Click here to download.
- B – See R08 Study Text, Chp 3
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?
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