Professional Paraplanner’s TDQ (Training, Development and Qualifications) series, is run in conjunction with key support providers, such as Brand Financial Training, and aims to test your knowledge of the financial services market, as part of your overall training goals and exam techniques.
The following questions, which can also be found in our October 2021 issue, relate to examinable Tax year 21/22, examinable by the CII until 31 August 2021.
Questions
1. In the Financial Conduct Authority’s Handbook, what information must be given in a direct offer financial promotion? Tick all that apply.
A. Must always mention that tax treatments can change
B. Confirmation that the firm is regulated or authorised by the FCA
C. The firm’s one-page product summary document featuring the FCA’s logo
D. Details of any charges and expenses
2. If the value of the pound fell, what effect (if any) would this normally have on the share price of major exporters?
A. Share prices would fall.
B. Share prices would be marked down.
C. There would be no effect.
D. Share prices would rise.
3. A company has been paid 200,000 euros for goods and wants to convert this into pounds. If the GBP:EUR quote is 1.2503/8 what would the company receive?
A. £159,859
B. £159,897
C. £159,936
D. £159,961
4. Sacha has several personal pension plans with small fund values. In relation to the small pots payments rules, Sacha should be aware that: Tick all that apply.
A. he can take a maximum of three small pots payments from non-occupational schemes.
B. he can take an unlimited number of small pots payments from non-occupational schemes.
C. small pots payments must be less than £10,000.
D. Sacha must be over the age of 50 to commute his pension benefits for a lump sum.
5. Which of the following categories of income is fully disregarded for care contribution assessment purposes?
A. Capital withdrawals from a capital investment bond
B. Income from a Permanent Health Insurance policy
C. Income from a mortgage protection policy
D. Attendance Allowance
6. A property is owned by Steve and Wendy as tenants in common. Steve dies while Wendy is in residential care, what is the position as regards the property?
A. Ownership of entire property passes to Wendy.
B. Value of whole property is subject to Inheritance Tax.
C. Stamp Duty Land Tax is payable on the conveyance between Steve and Wendy.
D. 50% of the property goes to Steve’s estate and passes subject to his will, 50% continues to be owned by Wendy.
7. The interest rate that banks charge each other is currently known as the:
A. London Inter-Bank Offered Rate.
B. Inter-bank Swap Rate.
C. London Banks Swap Rate.
D. The London Banks Offered Rate.
8. When would a Capital Gains Tax (CGT) chargeable disposal be deemed to have taken place in the following scenarios?
A. Sian, a beneficiary under a trust, becomes absolutely entitled to the trust assets.
B. James makes a gain of £120,000 on selling his main residence.
C. A married couple changes ownership of their investment bond when one becomes a basic rate taxpayer.
D. Peter dies and his antique car is passed to his son in accordance with his wishes.
9. An important measure of strength of a life office is its:
A. guaranteed products
B. with profit bonuses
C. free asset ratio
D. asset recovery statistics
10. Which element of the risk process is the following a description of? ‘The client’s personal opinion on the risks associated with making an investment, based on their prior knowledge and experience.’
A. Risk tolerance
B. Risk profile
C. Risk capacity
D. Risk perception
