Whether you are preparing for your exams, or simply want to keep your knowledge up-to-date, Professional Paraplanner’s Development Zone can help.
Every month, in conjunction with Brand Financial Training, we provide a series of questions from across the syllabus which aim to test your knowledge of the financial services market, as part of your overall self development training goals and exam techniques.
The following questions relate to examinable Tax year 23/24, examinable by the CII until 31 August 2024.
You will find the answers separately under the Development Zone tab on the Professional Paraplanner website.
QUESTIONS
1. Which of the following statements regarding ‘structured’ and ‘unstructured’ loans is incorrect?
A. Structured loans are viewed as lower risk than unstructured.
B. Unstructured loans tend to be for larger amounts.
C. The interest rate applied on an unstructured loan is usually linked to a base rate.
D. There is often no collateral to back up a structured loan.
2. Your client needs to achieve a real rate of return of 4.5% and inflation is estimated at 2% over the next year. What approximate nominal return must be achieved to meet his goal?
A. 7.4%
B. 6.59%
C. 6.50%
D. 6.08%
3. Which of the following statements regarding Stamp Duty on documents transferring share ownership is true? (Tick all that apply.)
A. The rate is 0.5% of the purchase price.
B. Stamp duty is paid by the seller.
C. Stamp duty is paid by the purchaser.
D. The purchaser is responsible for paying the stamp duty to HM Revenue & Customs.
4. Max is a client of yours who has always invested any surplus income directly in the stock market. He now wishes to set up a pension arrangement where he can continue to do this. Which of the following would be suitable for him?
A. A self-invested personal pension.
B. A small self-administered scheme.
C. A retirement annuity contract.
D. A Stakeholder plan or personal pension.
5. If a company has an agreement to purchase its own shares on the death of a shareholder, subject to HMRC agreement the sale will normally count as a
A. trading receipt for corporation tax purposes.
B. disposal for capital gains tax purposes.
C. chargeable transfer for inheritance tax purposes.
D. distribution for income tax purposes.
6. Business cycles occur around trends in a country’s overall economic activity. If the UK’s level of GDP has fallen compared to the previous quarter, the economy is said to be
A. reducing.
B. contracting.
C. recovering.
D. in recession
7. Each of the following is one of the four major currency pairs quoted in the Forex market with the exception of
A. EUR/USD.
B. USD/JPY.
C. GBP/USD.
D. GBP/CHF.
8. A comprehensive Private Medical Insurance policy will sometimes provide cover for which of the following in the context of long-term care provision?
A. Home Nursing.
B. The cost of treatment for long term incurable conditions.
C. Osteoarthritis.
D. Dementia.
9. Which of the following statements regarding the key elements of the MCOB definition of a lifetime mortgage is false?
A. Borrowers should be above a certain age.
B. There may or may not be a mortgage term.
C. Repayment can be sought at any time.
D. Potential deferral of interest repayments.
10. Paul has total taxable income of £60,000. This consists of £50,000 employment income and £10,000 rental income. He has recently sold his buy-to-let property, making a gain of £90,600, incurring costs of £7,400. How much capital gains tax can Paul expect to pay?
A. £12,780
B. £14,220
C. £19,852
D. £21,616
“Need help with your CII exams? For resources including mock exam papers and e-mocks, calculation workbooks, revision notes, audio masterclasses and video tutorials do visit Brand Financial Training and don’t forget to download your free taster versions!”
