View more on these topics

Testing time

1. The Green Budget presented on November 25, 1997 contained proposals for reform of which of the following taxes?

a: Income tax

b: Capital gains tax

c: Inheritance tax

d: Corporation tax

2. The Government proposes to introduce a new Individual Savings Account to replace Tessas and Peps. Which of the following statements is/are true?

a: It will be possible to transfer existing Peps into the ISA subject to the overal maximum of £50,000 in value

b: Up to £5,000 a year per person can be invested in an ISA whether the contribution is in cash or in other form

c: A maximum of £1,000 can be invested in cash into an ISA each year subject to a total limit of £50,000

d: It will not be possible to include life insurance within an ISA

3. Under the proposals for the ISA, when will existing Peps lose their tax-free status?

a: April 1, 1996

b: April 6, 1996

c: October 6, 1996

d: December 31, 1996

4. Which of the following statements is/are true in connection with existing Tessa accounts and the proposed ISA rules?

a: To preserve tax-free status, existing Tessas will have to be closed and transferred into an ISA by April 6, 1996

b: Existing Tessas will have to be closed and transferred into an ISA by October 6, 1999 in order to preserve tax-free status

c: Tessas in existence before the introduction of ISAs will be able to run their full original term within the current rules

d: Following the transfer of a Tessa into an ISA, there will be no limit on how long the investment must be kept to be tax-free

5. Which of the following investments will be acceptable under the proposed ISA rules?

a: Cash

b: Stock and shares

c: Life insurance policies

d: National Savings

e: Shares quoted on the AIM

Answers: 1 – d; 2 – a, c; 3 – c; 4 – c, d; 5 – a, b, c, d.



It&#39s that time of year again when we have to assess how the current year has gone and start to plan and budget for the next one. It never fails to surprise me that each year a number of events happen which I had not anticipated. This year has been better for us than expected. […]

ICS declares four ex-IFAs in default

The Investors Compensation Scheme has declared four former IFAs in default, opening the way for clients to lodge formal compensation claims. The firms are Richard K Thompson Associates of Cedars Avenue, Wombourne, Staffordshire; Manbury Personal Financial Advisers of Plaistow Lane, Bromley; Dyer Bussey Associates of Belle grove Road, Welling and W J Shore (Financial & […]

&#39Crazy&#39 A&L ads push mortgages

Alliance & Leicester is going mortgage crazy with a £1m campaign to promote its “completely insane” homeloan offers. The push includes advertising in the consumer and trade press with bizarre headlines like “Socks, stop singing so loud” to draw attention to its spring mortgage deals. The ads also carry the line “Completely insane mortgage deals […]

Wide-ranging tax shake-up feared in Green Budget

The Government is expected to deliver a major shake-up of capital gains tax, inheritance tax and higher-rate tax relief on pensions in next week&#39s Green Budget. The consultative document to be outlined by Chancellor Gordon Brown is likely to have radical implications for best advice given by IFAs. The proposals will form the basis of […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment