Term
When are CLTs used and when PETs - also explain the acronyms |
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Definition
CLT - Chargeable Lifetime Transfer
Used when giving to a discretionary trust
PETs - Potentially Exempt Transfers
Used for gifts to individuals
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Term
| Name the main exemptions for lifetime gifts |
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Definition
Marriage exemption
Small gifts =< 250 per person per year
Normal expenditure out of income, it must satisfy - regularly paid, from income and cause no decrease in living costs.
Annual exemptions
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Term
| What are the rates for donor paid and trustee paid tax for CLTs? |
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Definition
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Term
| Explain the pro-forma for lifetime taxes? |
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Definition
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Term
| Explain the pro-forma for death taxes |
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Definition
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Term
| Explain the pro-forma for lifetime transfers - additional tax on death. |
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Definition
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Term
| Who are exempt legacies (benefactors) for IHT on death estate? |
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Definition
Spouse/ civil partner
Charity
Political party
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Term
| With IHT there are no exempt assets only people |
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Definition
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Term
What is Karen's formula for quick sucession relief?
What is this multiplied by? |
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Definition
Net gift
gross gift
net gift is gross-tax
Multiplied by relevant percentage for period of time before transfer and date of death and tax paid on earlier transfer |
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Term
| What are the criteria for deductions for employment income? |
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Definition
| Wholly, neccesary and exclusive for work |
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Term
| Explain the pro-forma for the net earnings working with living accomodation expenses.. |
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Definition
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Term
Taxable benefit on cars explain! |
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Definition
Based on list price of car (to max list price £80)
Plus an additional accesories originally provided
Plus any further accesories costing moren £100
Actual charges in Hardmans |
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Term
| Do you time apportion benefits? I.e. car benefits? |
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Definition
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Term
| Average method for employment loans for working out taxable benefit? |
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Definition
Outstanding at start of year + outstanding at end, divided by two. Then multiplied by the average interest rate. Then minus any interest paid.
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Term
| Taxable benefit of an asset |
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Definition
Higher of annual value or annual charge.
Time apportioned if necessary.
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Term
| Taxable benefit for the transfer of an asset |
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Definition
Greater of:
- current market value
- MV when first provided less any amounts taxed (i.e. taxable benefits under private use rules
both minus an price pai by the emloyee for the transfer.
If car, van or comp equip t'fered before 6 April '06 it is just curr MV minus any price paid by employee.
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Term
| How are terminal payments taxed? |
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Definition
| The excess over £30k of dicretionary terminal payments is taxed after savings income and dividends at the highest marginal rate of tax. |
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Term
| Which payments are exempt, partly taxable and fully taxable? |
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Definition
Exempt - death, injury, pension lumps, stat redun pay
taxable - terminal bonus rewards, payment in lie of notice,
Partly taxable - dsicretionary payments over £30 k (reduced by stat redun pay) |
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Term
| For pofit adjustment, details which expenditure is allowed and not allowed... |
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Definition
Allowed - if incurred wholly, and exclusively for the purpose of trade. (Inc. pretrading expenditure)
Disallowed:
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- capital exp
- appropriations of profit
- general provisions
- non-trade debts
- most entertaining and gifts
- fines and penalties
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Term
| What is the formula for the part disposal of an asset for capital gains? |
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Definition
| (Market value of parts disposed of)/(market value of parts disposed of + MV of parts retained) all multiplied by the original cost (inc any incidental purchase costs) |
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Term
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Definition
Pr & cost under £6k exempt
Pr & cost over 6 normal charge
Proceeds above 6 & cost under, gains restricted to 5/3*(proceeds - 6)
Proceeds less than 6 and cost more - proceeds taken as 6
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Term
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Definition
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Term
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Definition
Relief on gain in value of property if not relieved by PPR.
Taken as the lowest of:
Letting gains
PPR relief
£40k |
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Term
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Definition
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Term
| Restriction on gift relief of shares, if there are investments on the books. |
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Definition
If gifted shares relate to a company with investments then the gain on dispoal is multiplied by
CBA/ CA
These are assets on whihc Capital gains tax would be would |
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Term
| Rules for allocating to partnerships... |
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Definition
Allocate partners profits before apportioning profit to tax years.
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