Friday Five – 8 November – 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 2019/20, examinable until 31 August 2020.

1. How does the Insurance Conduct of Business Sourcebook (ICOBS) categorise insurance products?
   1. According to commission basis, i.e. nil, upfront or trail
   2. Term assurance, whole of life and income replacement
   3. Life and critical illness, general insurance and income protection
   4. General insurance, pure protection and payment protection insurance

2. What are the principal factors affecting investment strategy that you expect to find documented within an Investor Policy Statement? Tick all that apply.
   1. Client circumstances
   2. Past performance
   3. Cash flow requirements
   4. Legal constraints
   5. Nature of liabilities

3. Desmond, a UK domicile, is the settlor of an offshore trust where the trustees have made a £25,000 capital gain in this tax year. Which of the following statements regarding liability for any CGT are correct? Tick all that apply.
   1. Desmond is liable but only if he has an interest in the trust
   2. Desmond is liable if he is UK resident this tax year and has an interest in the trust
   3. Desmond would not be liable if the trust was created after 06/04/99
   4. Where gains are not taxed on Desmond, UK resident beneficiaries will be liable on the distribution of any chargeable gains

4. Helen retired some years ago and now permanently lives overseas. Her State pension is NOT increased each April which would suggest she:
   1. has an insufficient NIC record.
   2. has a Category B pension.
   3. lives in a country with no reciprocal social security agreement with the UK.
   4. commuted the increases for a tax-free lump sum.

5. Matthew has surrendered an offshore life assurance policy. What rate, or rates, of income tax will he be potentially liable for on any chargeable gain?
   1. Higher or additional rates only
   2. Basic rate only
   3. Basic rate, higher rate or additional rate
   4. Any gain will be free of income tax

Answers

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

2. CDE – See R02 Study Text, Chp 8
   Grab our taster mock exam paper for CII R02. Click here to download.

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

4. C – 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?

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