Our Review of the CII’s October 2017 J02 Exam Paper

Next in line for our past paper analysis is J02, the exam which covers trusts – useful for those preparing to sit CII J02.

You can find the latest exam – October 2017 – by visiting the CII website.

Two hours are given to answer 15 short-answer questions for a total of 130 marks, and as we have said before, the exam rarely offers up any surprises; students just need to ensure that they have a full and proper grasp of the main areas which come up each time.

A Dream Question

The exam started with a dream of a question, explain the legal definition of a trust – although 8 marks does seem rather a lot to award for this, so it will be interesting to see the model answer when it is published.

Continuing Well

It continued well with the next question, again for 8 marks, asking students to identify four main types of beneficiary and explain their beneficial interest.

Not Enough to Faze the Well-Prepared Student

The next couple of questions covered trust theory which featured perpetuity periods and the Variation of Trusts Act 1958.  A well-prepared student should not have been fazed by these questions.

Cause for Some Head Scratching

Next, for 9 marks, we had the income and capital gains tax implications for investments in an offshore discretionary trust set up by a non-UK domicile which may have caused some head scratching if not studied in full.

Always Tested in One Way or Another

Powers of attorney, the Mental Capacity Act 2005, estate administration and bankruptcy came next – all areas which always are tested in one way or another so should not have caught candidates out.

Easy Marks

The last third of the paper covered the duties of a trustee with self-assessment; this should not have caused problems and 10 marks should have been fairly easy to attain: the return of estate administration and how savings interest is treated and a small calculation of the income tax that the personal representatives would be liable for on dividends received during the administration period for 3 marks.

The exam finished with a question on pension scheme trustees processes, the pros and cons of gifting into an absolute trust compared to a discretionary trust and finally the review question for 9 marks.

A Comparison with April’s Exam Paper

Let’s compare it with April’s paper which can be found here.

The April exam also began rather nicely with students having to state the legal parties to an existing trust and part (b) of the same question asking for 4 ways a trust differs from a contract.  Not a bad start at all.  We then had the usual suspects; bankruptcy, charitable trusts, powers of attorney and the duties of an executor.

The exam also included, amongst other things, IHT and business protection as well as POAT, the taxation of a discretionary trust, the powers of the court of protection and duties of the OPG, the alternatives to bankruptcy and spousal bypass trusts.

Overcome the Dry Material with Mind Maps

The J02 exam is all about the detail behind each question and although the manual is well written and manageable it is still a challenge remembering lists of information.  Using mind maps may help when trying to learn what can often be quite dry material.

Grab the resources you need!

If you’re studying for your CII J02 exam, and you’re wanting to be thoroughly prepared, grab our free taster to try out one of Brand Financial Training’s resources for yourself.  Click the link to download the J02 mock paper taster now!

Over to You…

If you’re planning on sitting J02 in the near future, do you use mind maps in your revision?