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The Technical Quiz – 18 October

To help you to keep up with the fundamentals of tax, retirement and financial planning, try answering these questions. Answers below.

The Technical Quiz MM 480

Question 1: A Relevant Life Policy is?

A) A whole of life policy effected by an employee

B) A whole of life/critical illness policy effected by an employer

C) A term assurance effected by an employer on the life of an employee

D) A form of key person policy for the benefit of the employer

Question 2: In relation to the premiums paid under a Relevant Life Policy?

A) They are paid out of an employee’s post-tax income

B) They are paid by an employer, are deductible for the employer and not assessable on the employee

C) They are paid by the employer but are not deductible

D) They are assessed to tax on the employee

Question 3: Which of the following documents is essential in relation to a Relevant Life Policy?

A) A Relevant Life Policy trust

B) An HMRC clearance certificate

C) An underwriter’s letter of approval

D) The company secretary’s letter of authority

Question 4: To whom are the benefits of a Relevant Life Policy payable by the trustees?

A) The company

B) The directors of the company

C) The company’s shareholders

D) Such beneficiaries as the trustees select from the discrectionary class under the RLP trust

Question 5: How does the benefit provided under the Relevant Life Policy affect the “covered employee’s” pension benefits?

A) The premiums paid reduce the employee’s annual allowance

B) The benefit reduces the employee’s lifetime allowance

C) The Relevant Life Policy has no effect on pension benefits

D) The premiums paid reduce the carry forward allowance

Questions supplied by Technical Connection

_________

Answers
1 C
2 B
3 A
4 D
5 C

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