Friday Five Focus on Pensions – 17 June – 5 Questions in 5 Minutes
Friday Five Focus on Pensions – 5 Questions in 5 Minutes Every Friday
What’s this all about?
Each week, we ask questions relating to one of these topics: Investments, Taxation, Pensions, Protection, or Regulation. This week, our Friday Five is relevant to Pensions; this is useful as you prepare for the CII’s R04, AF7, or J05 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 2021/22, examinable by the CII until 31 August 2022. They do not relate to tax year 2022/23 which is only examinable by the CII from 1 September 2022.
- Sportsman Joe retires in 2021/22 at the age of 35. Joe’s lifetime allowance will be reduced by what percentage for each complete year before normal minimum pension age?
- 10%
- 5%
- 2.5%
- 1.5%
- Evelyn wishes to make a complaint against her former employer in relation to incorrect administration of the occupational pension scheme. Who should she complain to?
- The Pensions Advisory Service
- The Pensions Ombudsman
- The Pensions Regulator
- The Financial Ombudsman Service
- Why might an employee view a contract-based pension scheme as a less valuable benefit than a trust-based pension scheme?
- Basic rate tax relief on contributions is not obtained immediately but instead via self-assessment.
- Early leavers lose employer contributions in the event of transfer within 2 years.
- Because the scheme has been outsourced to a third party and does not provide members with the protection of trustees.
- Because the scheme is unlikely to offer drawdown options at retirement.
- Bob crystallises his two pension plans in the year 2021/22. Based on the information below, what will the lifetime allowance charge be if Bob draws the excess as a cash lump sum?
Final salary scheme pension of £50,000 plus a tax-free cash sum of £100,000 Personal pension of £550,000, all of which is being used to purchase an immediate lifetime annuity. - Nil
- £144,225
- £317,295
- £454,795
- Freyja is hoping to qualify for a new State pension. To do so, she should be aware that she must: Tick all that apply.
- have a minimum of 10 qualifying years to receive any new State pension
- have at least 35 qualifying years to receive a full new State pension
- reach her State pension age on or after 6 April 2016
- have been employed or self-employed for at least 10 years
Answers
- C – See R04 Study Text, Chp 3
Grab our taster mock exam paper for CII R04. Click here to download.
- B – See R04 Study Text, Chp 4
Grab our taster mock exam paper for CII R04. Click here to download.
- C – See R04 Study Text, Chp 6
Grab our taster mock exam paper for CII R04. Click here to download.
- C – See R04 Study Text, Chp 2
Grab our taster mock exam paper for CII R04 Click here to download.
- ABC – See R04 Study Text, Chp 9
Grab our taster mock exam paper for CII R04. 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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