Business Tax Exam.

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13

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  • lmiddleham
    lmiddleham Registered Posts: 71 Regular contributor ⭐
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    i completely messed up the NI question, time apportioned it for the year as the 07/08 tax year starts in april.
    i got some decent menthod in there so maybe that will save me.

    some of the other answers cheered me up though, ie no marginal relief on corporation tax and the 6 months at 19%, 6 months at 20% bit.

    thought both of the emails didn't leave much to explain. i just give a brief rundown of taper relief and rollover relief
  • Cortez
    Cortez Registered Posts: 76 Regular contributor ⭐
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    jilbo wrote: »
    12 months before/3 years after
    Pigpen wrote: »
    Cortez - My books for rollover say new asset must be bought up to 12 months before or 36 months after
    ChloeGee wrote: »
    Think it's something like 12 months before the end of the accounting period in which you sell it and up to 36 months after.. ?

    Bugger :lol:
  • Gianfranco Zola
    Gianfranco Zola Registered Posts: 9 New contributor 🐸
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    Damn, I didnt mention that the rollover relief only applies if the gain is reinvested within a certain timeframe. I just said the gain could be used to reduce the base cost of the new asset.

    my emails were pretty brief
  • Pigpen
    Pigpen Registered Posts: 331 Dedicated contributor 🦉
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    I thought the chargeable gain had to be taxed in the year it was made so that would be the first 12 months - wouldn't it? I also calculated 6 months @ 19% as this was in the 2006/2007 tax year and 20% on the other 6 months although I forgot to deduct gift relief and then had to go back and re-work it all out
  • Gianfranco Zola
    Gianfranco Zola Registered Posts: 9 New contributor 🐸
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    not to reduce the base cost, but that it would come off the cost of the new asset to produce the 'base cost'

    my head's pretty fried right now, got DFS tomorrow and should be revising...
  • Cortez
    Cortez Registered Posts: 76 Regular contributor ⭐
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    Ah I didn't do anything with the gift aid either!
  • jilbo
    jilbo Registered Posts: 197 Dedicated contributor 🦉
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    I'm not sure I should keep reading these posts. I came out of the exam feeling quite confident but then after reading some of these posts have started to question myself! I too came out with a profit figure below the £37500 for the 3 mth period but I can't remember exactly how much it was.

    How do you all remember your exact figures. I tried to take in a blank peice of paper to jot some answers down on so I could check later just how well I did, but our 'guard' wouldn't allow it! However one of you managed to get the data sheets out is beyond me. Well done that man!!!

    Good luck to ebryone for Friday
  • popcornlpw
    popcornlpw Registered Posts: 30 Regular contributor ⭐
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    Pigpen wrote: »
    I thought the chargeable gain had to be taxed in the year it was made so that would be the first 12 months - wouldn't it? I also calculated 6 months @ 19% as this was in the 2006/2007 tax year and 20% on the other 6 months although I forgot to deduct gift relief and then had to go back and re-work it all out
    I think the gain was date some time in Dec or Jan ....?
  • ChloeGee
    ChloeGee Registered Posts: 23 New contributor 🐸
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    Gianfranco Zola wrote: »
    not to reduce the base cost, but that it would come off the cost of the new asset to produce the 'base cost'

    my head's pretty fried right now, got DFS tomorrow and should be revising...

    Think DFS will be a walk in the park compared to PEV and BTC, definitely glad those two were the first ones of the week, get them out of the way. Next three will be much easier I hope :)
  • Pigpen
    Pigpen Registered Posts: 331 Dedicated contributor 🦉
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    Ah well - theres nothing we can do about it now - Roll on Thursday - I am off to Ladies Day at Royal Ascot - The got personal taxation exam at 9.30 next morning - Fantastic planning - Not !!!!!
  • Pigpen
    Pigpen Registered Posts: 331 Dedicated contributor 🦉
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    Yeah - This was in the first period for PCTCT
  • jackie
    jackie Registered Posts: 81 Regular contributor ⭐
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    According to my interpretation of allowable expenditure, only parking fines incurred by employees whilst on business are allowable and all other fines and asscociated legal fees are not allowable for tax .
    Ref; Page 2.8 Osborne books.
    I found this exam okay but that scares me:001_unsure: PTC on friday- maybe waiting to catch us out on that one!

    Jackie
  • popcornlpw
    popcornlpw Registered Posts: 30 Regular contributor ⭐
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    Pigpen wrote: »
    Yeah - This was in the first period for PCTCT
    damm..I added it in the wrong period...?
  • Pigpen
    Pigpen Registered Posts: 331 Dedicated contributor 🦉
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    popcornlpw wrote: »
    damm..I added it in the wrong period...?

    Probably me - I don't trust anything I wrote now - I know I have stuffed up on the IBA - I made no allownace as to when the building was bought - I just gaily calculated 4 % of the cost then calculated that over 15 months - Don't even remember when they bought the building? Or even whether it was an industrial building now? :laugh:
  • shbh80
    shbh80 Registered Posts: 15 New contributor 🐸
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    can any one tell me detail about first and second email that we were supposed to write in BTC paper?
  • jilbo
    jilbo Registered Posts: 197 Dedicated contributor 🦉
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    popcornlpw wrote: »
    damm..I added it in the wrong period...?

    Sorry guys, are you referring to the gain?
  • tracy.b
    tracy.b Registered Posts: 3 New contributor 🐸
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    popcornlpw wrote: »
    yeb same here adj trading profit £145782

    I ended up with adjusted trading profit of £133632.
    the difference is the amount of dividends (5400+4500+2250) I deducted from net profit.
    145782-133632=12150

    Does it mean I am wrong?
  • phoebe
    phoebe Registered Posts: 17 New contributor 🐸
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    r.e iba i think i got £7000 as total iba for 15 month period does this ring a bell? calculated 4% (for 12 months) and 3/12 4% for the 3 month period as it is scaled down then added them together??? can't remember how much the building cost now!! deducted whatever figure it was plus the c.a already calculated off of my trading profits figure before time apportioning it. not sure if this was right!
    then i deducted the b/f losses from the 12 month total to give my schedule d case 1 figure. anyone the same?
    x
  • Pigpen
    Pigpen Registered Posts: 331 Dedicated contributor 🦉
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    I got £7000 too. Oh well - Time will tell - Building was £140k
  • phoebe
    phoebe Registered Posts: 17 New contributor 🐸
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    added the first 2 dividends to first pctct and last 1 to the 3 month pctct. (groosed up though)
    x
  • Pigpen
    Pigpen Registered Posts: 331 Dedicated contributor 🦉
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    phoebe wrote: »
    added the first 2 dividends to first pctct and last 1 to the 3 month pctct. (groosed up though)
    x

    Me too x Grossed up to give "profits" figure for both periods
  • sjc84
    sjc84 Registered Posts: 5 New contributor 🐸
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    tracy.b wrote: »
    I ended up with adjusted trading profit of £133632.
    the difference is the amount of dividends (5400+4500+2250) I deducted from net profit.
    145782-133632=12150

    Does it mean I am wrong?

    Thats the figure that i got aswell!
  • phoebe
    phoebe Registered Posts: 17 New contributor 🐸
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    first email was it part disposal of assets we were supposed to mention i.e.
    allowable cost x market price of part disposed of/ market price of part disposed of + market price of part retained????
    then taper relief allowed, then personal alowance (£9200)?
    was so confused!
    x
  • jilbo
    jilbo Registered Posts: 197 Dedicated contributor 🦉
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    As the biulding was acquired in Dec 06 I calculated 13 months of IBA for year ended 31.12.07.

    Anyone else?
  • popcornlpw
    popcornlpw Registered Posts: 30 Regular contributor ⭐
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    tracy.b wrote: »
    I ended up with adjusted trading profit of £133632.
    the difference is the amount of dividends (5400+4500+2250) I deducted from net profit.
    145782-133632=12150

    Does it mean I am wrong?
    I think you r not totaly wrong but it will take you some mark..as you still cary the same figures to the next task
  • phoebe
    phoebe Registered Posts: 17 New contributor 🐸
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    don't think it matters when the building was purchased, as long as it is in industrial use at the year end you get the 4% for the year. however it is time apportioned for short CAPs- thats how i understood it!!
    x
  • jilbo
    jilbo Registered Posts: 197 Dedicated contributor 🦉
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    phoebe wrote: »
    first email was it part disposal of assets we were supposed to mention i.e.
    allowable cost x market price of part disposed of/ market price of part disposed of + market price of part retained????
    then taper relief allowed, then personal alowance (£9200)?
    was so confused!
    x

    Yes it was disposal, think I calculated the gain ok but I fogot the annaul exempt amount. Bugger !
  • Maybes
    Maybes Registered Posts: 8 New contributor 🐸
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    Messed up on the tax payable part in section 2. Didnt time apportion it over the tax years, like an idiot so did both at 20%!! Damn!

    Re the IBA, I did 140,000/300months(25years) = £466.67 a month and then x by 13months as they brought it into use in Dec 06 ....not sure whether that was right? Gave me a figure of £6067

    I was pondering whether just do it at 4% which would give £7000 over the 15months or the way I did it. It was quite confusing really.

    Not confident about the outcome of this exam at all.:thumbdown:
  • laurenw
    laurenw Registered Posts: 42 Regular contributor ⭐
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    I did the same as maybes with the IBA, except i did 140K/300x15 months, gave me 7000.

    Gutted i forgot to deduct any of the IBA from the trading profits!!!

    I also didnt deduct the gift aid payment in the first period as we were ofsetting a loss, completely wrong lol.

    Oh well, the rest of the answers seem ok and i did 6 months at 19% and 6 months at 20%, for the short CAP i got a tax figure of 5771.

    Also waffeled on about indexation allowance, rollover relief and taper relief.

    Did anyone work out the calculation in section 1, i got 75K cost & 25% chargeable, less annual amount.

    Fingers crossed for August :-)
  • jilbo
    jilbo Registered Posts: 197 Dedicated contributor 🦉
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    Yeah I got the same figure £18750, but forgot the annual exempt amount

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