ICAEW CFAB PoT Revision Class - IT, CA, NIC, CGT, CTA (part 1)

Janice is an employee of Friends Ltd with a gross annual salary of £90,000. In addition, Janice has taxable benefits worth £5,426. Friends Ltd does not use voluntary payrolling for benefits. Janice overpaid her tax for 2021/22 by £200. Janice has agreed with HMRC that this overpayment will be refunded via her PAYE code for 2023/24.

What is Janice's PAYE code for 2023/24?

(a)  

Which two of the following statements indicate that a trade is not being carried on?

• Henry has just sold a house that he bought three months ago. He spent £78,000 purely to make the property more attractive to potential purchasers.

• Omar sold a third batch of shares in a single week, making a substantial profit.

• Tariq is experiencing cash flow problems and has had to sell a car that he bought three months ago to replace his old car. This is Tariq's fourth car in the past year.

• William restores and resells antique chandeliers for a profit in his spare time. He has just sold a chandelier that he has been renovating for the last six months. This is the third renovated chandelier that he has sold in the last two years.

Paul has been trading for many years making up accounts to 31 December each year.

At 1 January 2023, the tax written down value of his main pool was £9,000.

On 1 May 2023, Paul bought a machine for use in the business costing £40,000.

What are the maximum capital allowances that Paul can claim for the year to 31 December 2023?

• £8,820

• £41,620

• £49,000

• £40,000

A sole trader, Arnold, has plant and machinery with a tax written down value of £21,600 on 1 January 2023. During the year ended 31 December 2023 he sold machinery for £2,800 which had cost £7,000.

What is the maximum amount of capital allowances available to Arnold for the year ended 31 December 2023?

• £3,384

• £2,628

• £3,888

• £3,132

Scott is a Chartered Accountant and is married to Becki, who is also his cient. Becki runs an assortment of businesses on behalf of her father. Scott knows that Becki comes from a wealthy criminal family. However, Scott has never queried the funding of Becki's businesses as he trusts her implicitly.

Select which two of the following options correctly identify the types of threat Scott is experiencing according to the Code of Ethics.

• Self-interest threat

• Self-review threat

• Advocacy threat

• Familiarity threat

• Intimidation threat

Phoebe is a Chartered Accountant who has just received a client's statement of tax liability for the previous tax year from HMRC. It is apparent that HMRC has made a material error in its calculation of the client's, Ruby's tax liability which has resulted in a substantial repayment of tax. However, Ruby is unwilling to disclose this, despite Phoebe's advice to make full disclosure.

Select which of the following options correctly identifies Ruby's behaviour in relation to the repayment

A Tax avoidance

B Tax evasion

Select which of the following options correctly identifies whether Ruby's refusal to disclose is within the scope of money laundering.

C Excluded

D Included

• Tax avoidance

• Tax evasion

• Excluded

• Included

Layton received bank interest of £40,000 in 2023/24. This was his only income.

What is Layton's income tax liability for the year?

£

(a)  

Joe received employment income of £53,000 in 2023/24. His PAYE deducted for the year was £8,840.

What is the tax payable or (repayable to) Joe for the year?

Note: For amount (repayable to), please put in bracket.

(a)  

In 2023/24, Roz has taxable income (all non-savings income) of £43,395 and makes a cash donation of £1,000 to charity under the Gift Aid Scheme.

What is Roz's income tax liability for the year?

(a)  

Susan is provided with living accommodation by her employer on 6 October 2023. The annual value of the accommodation is £2,500.

The original cost of the accommodation to the employer in 2005 was £80,000. The market value of the accommodation on 6 October 2023 is £190,000. The official rate of interest in 2023/24 is 2.25%.

Susan does not make any payment to her employer for the use of the accommodation.

(a)