Friday Five – 5 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.

Questions

IMPORTANT!  These questions relate to examinable tax year 2018/19, examinable by the CII until 31 August 2019.  They do not relate to tax year 2019/20 which is only examinable by the CII from 1 September 2019.

1. Whose professional indemnity insurance requirements are set out in MIPRU?
   1. Banks
   2. Investment businesses
   3. Building societies
   4. Home finance firms

2. A commercial property has been valued using a high multiple (i.e. low yield), what does this suggest?
   1. The property has strong growth prospects
   2. It is probably an industrial property
   3. The quality of tenants is dubious
   4. The lease is relatively short

3. David transferred ownership of his share portfolio to his son realising a gain on which he paid Capital Gains Tax (CGT). Four years later David died, what tax, if any, is now due?
   1. His son faces a potential CGT charge on the difference between the value at which he acquired the asset and the market value at David’s death
   2. As a failed PET, there is a potential IHT charge with no credit given for the CGT paid on the earlier transfer
   3. There would be no further charge due to the CGT paid on the earlier transfer
   4. There may be an IHT charge, but relief would be given for the CGT paid

4. John has a defined contribution AVC whereas Tom’s AVC is on an “added years” basis. In which area, will Tom’s arrangement differ from John’s?
   1. Tax relief on contributions.
   2. Some of the benefit can be in the form of tax-free cash.
   3. Minimum pension age.
   4. Inability to draw the benefit independent of the main scheme.

5. Georgia wants to set up a Lasting Power of Attorney for her daughter. If she did not do this and became mentally incapable, who would be responsible for handling her affairs?
   1. Her solicitor
   2. A Deputy appointed by the Court of Protection
   3. Her family
   4. A guardian employed by the Department of Social Security

Answers

1. D – See R01 Study Text, Chp 5:2
   Grab our taster mock exam paper for CII R01. Click here to download.

2. A – See R02 Study Text, Chp 1:2
   Grab our taster mock exam paper for CII R02. Click here to download.

3. B – See R03 Study Text, Chp 12
   Grab our taster mock exam paper for CII R03. Click here to download.

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

5. B – See R05 Study Text, Chp 8
   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?

If you found this quiz useful for your CII exam revision, please do share it with your colleagues.