Friday Five Focus on Taxation – 26 May – 5 Questions in 5 Minutes

Friday Five Focus on Taxation – 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 Taxation; this is useful as you prepare for the CII’s R03 or AF1 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 2022/23, examinable by the CII until 31 August 2023. They do not relate to tax year 2023/24 which is only examinable by the CII from 1 September 2023.

1. Maureen has an asset that is worth so little that it qualified for a ‘negligible value claim’ on 1 September 2020. She now wants to backdate a claim for the loss she’s made to that tax year. Which of the following dates is the deadline for her to backdate the claim to 2020/21?
   1. 5 April 2022.
   2. 30 July 2022.
   3. 30 January 2023.
   4. 5 April 2023.

2. Samantha has an offshore bond and her friend Julia has an onshore bond. They have asked you to explain some of the features of both products. You can tell them that: Tick all that apply.
   1. only onshore bonds benefit from ‘time apportionment relief’.
   2. only offshore bonds benefit from gross roll up.
   3. both products benefit from top slicing relief.
   4. offshore bonds are better protected in the event of the company failing.

3. John is employed full time in a local school but in his spare time makes children’s toys. His earnings for this are £100 per week. Which of the following National Insurance contributions must John pay on these self-employed earnings?
   1. Class 2 only.
   2. Class 3 only.
   3. Class 4 only.
   4. He is not obliged to make any contribution.

4. Which of the following is a taxable benefit for employees?
   1. Liability insurance.
   2. Group income protection.
   3. Private medical insurance.
   4. A mobile phone.

5. Steven has four rental properties as described below. Which of them could qualify as a furnished holiday let?
   1. A furnished barn conversion, let at a commercial rate for 250 days in total in the current tax year.
   2. An unfurnished seaside cottage, let at a commercial rate 280 days in total in the current tax year.
   3. A furnished seaside cottage that’s primarily used for family and friends at ‘mates rates’.
   4. A furnished flat in a tourist hotspot, let at a commercial rate for a continuous period of six months in the current tax year.

Answers

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

2. BC – See R03 Study Text, Chp 10
   Grab our taster mock exam paper for CII R03. Click here to download.

3. D – See R03 Study Text, Chp 2
   Grab our taster mock exam paper for CII R03. Click here to download.

4. C – See R03 Study Text, Chp 1
   Grab our taster mock exam paper for CII R03 Click here to download.

5. A – See R03 Study Text, Chp 9
   Grab our taster mock exam paper for CII R03. 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.