Friday Five – 7 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.

Questions

These questions relate to examinable tax year 2018/19, examinable until 31 August 2019.

1. Deliberately not paying due regard to the interests of a customer does not comply with which Statement of Principle?
   1. Organisation and control
   2. Integrity
   3. Market conduct
   4. Open and co-operative

2. Which of the following properties would present the best opportunity for a potential residential property investment in terms of rental yield and long-term capital growth?
   1. A 5-bedroom townhouse
   2. A 2-bedroom 200-year-old cottage
   3. A 3-bed modern house with a 5-year rental agreement
   4. A 2-bed modern semi

3. Amelia makes a transfer into a discretionary trust of £500,000 after exemptions for the benefit of her four grandchildren. What Inheritance Tax is now due on this transfer assuming the trustees pay the tax?
   1. £100,000
   2. £65,000
   3. £35,000
   4. Nil

4. At A-day Freda opted for Primary Protection. She chose this route because:
   1. it was possible the Lifetime allowance could be breached in the future.
   2. her fund was in excess of £1.5 million.
   3. her fund was less than £1.5 million.
   4. she wanted assurance that a Lifetime Allowance charge would never apply.

5. What is the advantage from an income tax point of view of a pre-funded long-term care insurance policy?
   1. Benefits can be paid free of tax to either policyholder or care provider
   2. Policy fund accumulates tax free
   3. Benefits can be paid tax free if paid directly to care provider
   4. Premiums qualify for basic rate tax relief

Answers

1. B – See R01 Study Text, Chp 9
   Grab our taster mock exam paper for CII R01. Click here to download.

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

3. C – 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 2:2
   Grab our taster mock exam paper for CII R04. Click here to download.

5. A – See CF8 Study Text, Chp 5
   Grab our taster mock exam paper for CII CF8. 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!)