TDQ: Test Your Knowledge QUESTIONS (July/August 2018 issue)
28 June 2018
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Here are this month’s TDQ: Test Your Knowledge questions, published in the June 2018 issue of Professional Paraplanner.
These questions relate to examinable Tax year 17/18, examinable by the CII until 31 August 2018. These DO NOT relate to tax year 18/19 as this is not currently examined.
1. Damian has been found guilty of market abuse. What is the maximum criminal penalty for this offence?
A. A fine limited to £10 million
B. 5 years’ imprisonment
C. An unlimited fine and 5 years’ imprisonment
D. An unlimited fine or 7 years’ imprisonment
2. Which of the following factors would have the effect of reducing short-term interest rates?
A. Quantitative easing
B. Government plans to issue gilts to fund a deficit
C. Inflation expectations
D. Strong economic activity
3. In the event of a married couple both dying in a plane crash where it’s impossible to say who died first, what is the assumption of general law (Law of Property Act 1925) and what is presumed for the purposes of Inheritance Tax?
A. General law assumes the older life died first whereas for IHT purposes it is assumed they died at the same time
B. General law assumes the older life died first and for IHT purposes this is also the presumption
C. General law assumes they both died at the same time and this is also the presumption for IHT purposes
D. General law assumes they died at the same time and for IHT purposes it is presumed that the older life died first
4. Under the identification rules used for calculating CGT on shares of the same type and class acquired at different times, how are shares grouped? Tick all that apply.
A. Acquisitions within the following 90 days
B. Acquisitions on the same day
C. Acquisitions arising from a rights issue
D. Acquisitions in the share pool
5. Which of the following rules regarding trivial commutation by a pension member are TRUE? Tick all that apply.
A. Facility is not available until age 60.
B. There is a 12-month commutation period.
C. The commutation limit is £30,000 across all schemes.
D. All of the resulting proceeds will be tax-free.
6. Who of the following would be eligible for Statutory Sick Pay?
A. Philip, employed part-time and not paying any National Insurance contributions
B. Steven, self-employed and paying Class 2 and Class 4 National Insurance contributions
C. Brenda, currently on a career break and paying Class 3 National Insurance contributions
D. Miriam, employed and paying Class 1 National Insurance contributions
7. Money market instruments allow issuers to raise funds for short-term periods at relatively low interest rates. Out of the following options, which is a feature of a Treasury bill, a money market instrument issued by the government?
A. Issued at daily auctions
B. Issued at a price below par
C. Interest paid monthly
D. High risk
8. What is the main difference between an Exchange traded note (ETN) and an Exchange traded fund?
A. An ETN is a bond issued by a bank
B. An ETN is traded on a stock exchange
C. An ETN tracks the movement of an index
D. An ETN gives access to specialist markets
9. Section 117 of the Mental Health Act 1983 requires what of Local Authorities in England?
A. That they provide secure accommodation to patients who have been detained under the Act
B. That they provide continuing support to people who have previously been detained under the Act free of charge
C. That they provide care in the community subject to a reasonable charge
D. That they appoint a welfare attorney for the patient
10. Florence’s dementia has deteriorated to the point where she needs round-the-clock care. Consequently, she has moved in to a nearby long-term care facility. Her local authority is unable to place a charge on her property to fund her care. Why might this be?
A. She had previously taken out a lifetime mortgage on her property
B. She had entered a full home reversion plan
C. She had previously taken out a home income plan on her property
D. She had entered a partial home reversion plan
Need help with your CII exams? For resources including mock exam papers, calculation workbooks, study notes, audio masterclasses and e-learning videos do visit Brand Financial Training at https://brandft.co.uk and don’t forget to download your free taster versions!
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