Tax and Trusts Tax Year End Quiz Webinar

Check your answers

1. For Inheritance Tax (IHT) planning purposes, how significant is the tax year end?

a. Extremely significant

b. It’s an important milestone

c. It has zero significance

2. In 2006, Donald purchased 10,000 shares @ £2.50 each in an OEIC fund. In 2012, he purchased a further 5,000 shares in the same fund @ £4 each. Current share price is now £5.05 and he sells 6,000 shares from his 15,000 share portfolio. What is the acquisition cost in his CGT calculation?

a. £2.50

b. £3.00

c. £3.25

d. £4.00

3. With regard to capital gains and losses, which of one of these statements is false?

a. Current tax year losses must be deducted in full

b. Carried forward losses must be deducted in full

c. Current tax year losses must be used before losses carried forward

d. To be allowable a capital loss must be quantified and claimed

4. In 2020/21, Emma who lives in England, has salary of £55,000 and realises a £40,000 gain on a UK Bond gain held for 10 complete years. Tax due after top slicing relief of £1,800 is £15,500 (split £9,500 on salary and £6,000 on the bond gain).

Assuming she pays a net pension contribution of £8,000, please estimate the effective rate of tax relief on her pension contribution.

a. 20%

b. 40%

c. 60%

d. 90%

5. Later today, you have a call with Mr & Mrs Brown to discuss IHT planning. They have made no previous gifts.

You discuss the IHT annual exemption. The clients ask you how much IHT could be saved immediately by using the exemption.

a. £600

b. £1,200

c. £2,400

d. £4,800

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