The CII AF1 September 2022 Exam in Review
Last updated on August 3rd, 2023 at 7:34 am

The CII has released their papers from the exam sittings that happened in September. In this article, we look at what was tested this time round in AF1: the Personal Tax and Trust Planning paper.
You can find the exam guide here.
Question 1
The first case study started by stating that Aled had died in May 2022. He was widowed and had left two adult children.
The first question was a calculation of Aled’s IHT position. It was relatively straightforward except for the 14-year rule may have proved difficult for some. A CLT had been made in 2012 which impacted the PET made in 2017. However, the rest of the calculation should have meant some marks would have been achieved by most candidates.
Other more complicated areas in this first question included testing the taxation of an investment bond. The bond had been set up on the lives of the adult children, and they had surrendered it during the administration of the estate. This is an area probably not overly tested in the past, and it did cause difficulties perhaps where the information in the case study had not been thought through in enough detail.
Next came a question on the Trustee Registration Service – it was for 5 marks and although covered in the CII J02 manual did seem to cause some difficulties for candidates.
The rest of the case study tested exit charges on a discretionary will trust, stamp duty land tax on a second property, and finally the various rules around the second property qualifying as a furnished holiday let. Some of the areas have appeared before in the AF1 exam although ‘averaging elections’ may have been a new topic; candidates may have picked up some marks through logically thinking about what this might mean even if they had not studied the content. Some marks should have been giveaways in terms of the stamp duty land tax, as this information is in the tax table that candidates have access to.
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Question 2
In this question, we met Chloe, a 48-year-old divorcee living with her partner Ewan and, soon to be 18, son Ben.
The first question was again a calculation – this time Income Tax. Again a relatively straightforward calculation the only difficulty perhaps is ignoring the dividends from the VCT as these are not taxable and ensuring that the dividend allowance and personal savings allowance are accounted for within the basic rate band threshold.
Candidates then had to calculate National Insurance contributions, and again, some of these marks would have been giveaways as much of the information is in the tax table. The better candidates would have recognised that this year there has been a split between 6 April to 5 July and then from 6 July to the end of the tax year.
The impact of divorce on a Will has been tested many times before and should not have caused problems for the well-prepared candidates. However, question (d) tested what would happen to a Child Trust Fund when Ben reached age 18. This has been covered in the press since the first CTFs matured in 2020 but may have caused some difficulties for some candidates.
Question 3
This question also started with a calculation, this time Capital Gains Tax. What may have caught some candidates out was the extension of the basic rate band for the pension contribution and how this would impact the amount chargeable at basic rate and the amount charged at higher rate.
Residency and domicile is always tested within AF1 yet it appears from the examiner’s comments that often this is an area of weakness. This exam tested the implications on a share sale when moving overseas.
The exam finished with the impact of overseas residence on an ISA and finally a question on powers of attorney.
Within this paper, there appears to have been a good spread of knowledge being tested with some giveaway marks within SDLT and NICs. However, there were also some trickier areas such as the relatively new Trust Registration Service and the CTFs both of which must serve as a reminder to future AF1 candidates that they should keep up to date with changes in the industry.
Comparison with the April 2022 Exam Paper
Let’s look at what was tested in April 2022’s paper. This question paper can be found here.
The topics covered were:
- Income Tax Calculation and Income Tax mitigation
- Registering for self-employed status and self-employed taxation
- National Insurance contributions
- Pension contributions
- Powers of attorney
- Discretionary trust income
- Trusts for vulnerable beneficiaries
- CGT on sale of a flat
- Seed Enterprise Investment Schemes
- Residence nil rate band downsizing rules
- IHT calculation and UK domicile election
- Wills
- Overseas income and gains
- Excluded property trusts
The last session did cover different technical areas of course but what is clear is that in each paper there is an Income Tax, IHT, and CGT calculation; future candidates must ensure they have studied the methods of calculating these taxes covering various different scenarios.
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