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The Technical Quiz: 5 March

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

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Question one

What must be the medical condition of a DB scheme member for a serious ill-health lump sum to be paid? 

A) Unable to follow own occupation

B) Unable to follow any occupation

C) Unable to follow any occupation and unlikely ever to return to work

D) Life expectancy of under one year

 

Question two

Mona is an employee who has the use of a company car for a whole tax year. The taxable benefit amounts to £8,662. What is the correct national insurance liability for 2014/15? 

A) Mona pays national insurance of £8,662 less £7,956 at 13.8 per cent = £97.43

B) Mona’s employer pays national insurance of 13.8 per cent on the taxable benefit of £8,662 = £1,195.36

C) No NIC is payable on benefits, only salaries and bonuses

D) Mona pays national insurance of 13.8 per cent on the taxable benefit of £8,662 = £1,195.35

 

Question three

Victoria is in receipt of a loan of £20,000 from her 100 per cent owned company Woody Ltd. What is the tax effect of this? 

A) The company has made a loan to a participator and will have a 50 per cent charge to pay on the loan. There is also a benefit in kind assessable on Victoria

B) There is no tax effect

C) The company has made a loan to a participator and will have a 25 per cent charge to pay on the loan

D) There is a benefit in kind assessable on Victoria

 

Question four

Mick and Teresa, a married couple of 55 and 53 years old respectively, are considering life cover. Which of the following is likely to be the cheapest overall? 

A) Two, single life, whole of life policies for £100,000

B) A joint life second death whole of life policy for £100,000

C) A joint life first death whole of life policy for £100,000

D) A joint ownership, single life whole of life policy on Mick’s life for £100,000

 

Scroll down for answers…

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Answers

1) D

2) B

3) C

4) B

 

 

 

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