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Oh I split the aia by two for the six months and then by the number of associates which wrong, I knew they only got one between them but for some reason forgot that it could be divided however they choose.
I thought that the 3rd associate was acquired April 2014? Therefore would have been an associate in the six months to 30 September 2014? Maybe I misread the question.
The £50,000 limit was for question 2 but I had no idea what to do with it!
No you can’t preserve the personal allowance.
In question 2 did anyone else take the rental income into account of £5,000 each year? The loss has to be carried back on a fifo basis so does this mean we should have first offset it against rental income in 2011/12 then income in 2012/13 then 2013/17? I thought this was quite misleading as it didn’t state when the rental income started.
On the UK paper there was a bit about the payments on account post 31 January 2015.
On question 2 were we supposed to calculate the 10% for the charity on the estate before the house and cash to the daughters of £1m or include everything and calculate it on the £2m? My mind went totally blank! Also is this the figure before the nrb? As I forgot to put the nrb into my calculation!!!
Q1 – I said that the loss b/fwd from bond couldn’t be offset as there had been a change in the nature and conduct of trade, I didn’t allow the 10% as I hadn’t read anything about this. I said that he had claimed too much on the capital allowances as the AIA had to be decided between the number of associates. I also split the upper and lower limits by three. For some reason I split the AIA by two as I was thinking about groups even though I split the limits by three! I did originally split the AIA by 3 so I’m hoping the marker will give me credit for this.
How did everyone calculate the roll over relief? I think I got a gain of £40,000 that was immediately chargeable – the sale proceeds not re-invested £390,000 less £350,000.
I said that ungar would benefit from the patent profit scheme and put some points down for the capital goods scheme so fingers crossed I’ve picked up some marks there.
Q2 – got slightly confused with this one under exam pressure. I restricted the loss as I remember reading something about it but when I got home I read that it is restricted to £50,000 against other income so effectively the capital gain. I forgot to take the capital gain into consideration when carrying back the loss!!!
I also calculated the payments on account based on the income tax figures in the question, did anyone else do this?
Q3 – said that the donation to charity wasn’t 10% so needed to be increased.
Benefits of making lifetime gifts such as gifting appreciating assets and taper relief. Wasn’t really sure what else there was to say!
Deed of variation to avoid potentially being taxed twice if he dies within 7 yes, didn’t have much time to put any points on this question.
I said about the negligible value claims on the fall in value of quoted shares.
Q5 – penalty £100 and £300 / should have filed two returns, 12 month period and 4 month period.
CSOP available to all employees at £30,000 maximum. Forgot to mention that they couldn’t own more than 30%of company!! Said there would be no income tax but would be capital gains tax.
SIP said max £3,000 but couldn’t remember if this was per year or employee!
CFC – I put that they would be taxed at 23%
Really time pressured exam but fingers crossed I’ve enough
Oh no after reading all of these comments I have realised that I totally misunderstood Q2 part a, I talked about the strategy clock and that Marco could adopt a differentiation strategy. Hoping that I get some marks from this as I did talk about setting a premium price!
Yes I put the same and that the £800,000 management charged should be eliminated in the consolidation due to inter-company transactions but that it might have been left in to inflate revenues due to the management’s bonuses.
For Q5 part a I also got confused as I thought how can there be 8 marks for the going concern element and then re-read the question and it mentioned the quality and usefulness to the users so I basically wrote down all of the changes that the student article proposed.
For part b I put that the first paragraph should have been two paragraphs, a basis of opinion and then an opinion paragraph. I also put that it should have been a qualified opinion or adverse but not a disclaimer of opinion. as this would suggest that the auditors were unable to obtain sufficient audit evidence. I also put that the emphasis of matter paragraph shouldn’t have been used and that they should have quantified the material misstatement and mentioned the relevant standards in full that the financial statements did not comply with. I also put that they shouldn’t have made reference to the director’s name in the report.
What did everyone get as there audit risks? There didn’t seem to be very many numbers relating to the subs so it was hard to talk about materiality in question 1.
<cite> @jenny3549 said:</cite>
More or less exactly the same. Know I made some silly mistakes that I’m really kicking myself about as I realised as soon as I left!
Q1 – didn’t include the AMAP in the calculation of Class 1 Primary (even though told myself to when reading question!)
– completely forgot to restrict the wife’s Age Allowance for income over 25400 – so had a bit with starting rate of 10%
Q2 – very annoyed with self for some basic errors due to panicking (was my first exam). Managed to convince myself couldn’t have a balancing charge on the special rate pool – got confused with not having the balancing allowance – bugger!
– also got one of the adjustments wrong as had spent previous day revising VAT so had that in my head so allowed entertaining o/seas customers – poop!
– associated companies fine but then completely forgot about the 75% rule for group relief so got that wrong.
Q3 – think that was all fine.
Q4 – left til last as didn’t fancy it so did in a rush at the end but think got it right (deducted 2/11 overlap profits in year of change) although couldn’t remember any points to make for the wordy bit apart from not having made a change in the previous 5 years.
Q5 – think all fine GCT was house less 6000 less 5000 marriage so ended using NRB on death so Phil had IHT to pay less taper relief. IHT on 440k at 40%. CGT used probate value for house etc.Overall should think I passed – just really annoyed at self for the silly errors – would much rather get things wrong because I didn’t know or couldn’t remember than because didn’t cope with exam hall pressure!
Am forgetting about it now as F7 tomorrow and that’s just about trying to scrape a pass!
I think the entertaining overseas customers is allowable. I put this in my calculation too. It’s the entertaining UK customers that isn’t. I think anyway.
Good will with F7, try to do the pro-forma of the financial statements and put the figures in that don’t need adjusting as you get marks for those. Try not to get too stressed in the exam 🙂
<cite> @mohamedd786 said:</cite>
Here are the answers I put down1) % for the car was 32%. Apportioned the car and fuel benefit for the part of the year where the car/petrol was provided.
AMAP wouldn’t have been claimable to travel from home to work, but allowed for the other 2. Minus what was given to him, to the AMAP to get a benefit.
Loan benefit- loan outstanding at start of year plus loan outstanding at the end of year, divided by 2, times ORI. Minus the actual interest that he paid, giving the loan benefit.
Occupational pension deducted from Gross Salary.
Personal pension he would be able to invest in- 10,000 for the 3 years b/f and 10,000 for the current year. Thus, Basic Rate Band extended 40,000 times 100/80.
No Personal Allowance available as ANI was over 116,000
Holiday letting treated as property income.NIC 1 A on loan, car fuel and AMAP benefit.
10% starting rate for Rhoda, and reduction in her Personal Age Allowance as her Net Income is more than 25400.
2) Balancing charge on the special pool,
One of the car was eligible for FYA.
3 associates (4 including the parent)
Group Loss relief of 64000 was the only one they could claim.
Dividends from the company that they had a 40% stake in, included as FII at * (100/90)
Tax was in the marginal rateVAT output of 300/6= 500
Impaired debt (wasn’t too sure on this), was recoverable as it was exactly 6 months since payment was due?
Had to subtract UK customer entertainment from input VAT figure.
No adjustment for overseas customer entertainment, repairs, etc?3 a) 6625 shares
b) No Rollover relief on warehouse 1 as sale proceeds greatly higher than re-investment
Some rollover relief on warehouse 2, and some gain (proceeds that werent reinvested)c) Enterpreneur relief for one of the persons, so 10% for him, and 28% for the other. 2000 shares valued at 2000 pounds for the first person, and cost of shares for the second person was 2000/3000*acquisition cost
Tax saving was around 3000-4000ish pounds.4) a) first yr assesment for 11 months till 31st march. this was also overlap profits, other years CYB
Final 14 months period, WDA given for 18%*14/12.
Overlap Profits of 2 months deducted to bring the taxable months to 12.b) 2 CAPs. The first for 12 months, than for 2 months. WDA and AIA for the 2 months proportionally reduced.
5) Reduce gift of house by Annual exemption of 2 years (6000 pounds) plus marriage exemption of 5000 pounds. This gives the Gross chargeable transfer. Death tax on PET would be GCT less NRB of 325,000. IHT @ 40% and taper relief @ 60 %.
Half of the death estate was exempt, the other half chargeable at 40%.
ii) Tax on house payable by sonc) Income tax on rents (less repairs, less insurance)
CGT on proceeds less legal fees, the value of house when inherited and capital expenditure.Anyone else got something similar? Any feedback would be appreciates .
Pretty much exactly the same as you! 🙂
<cite> @confused1 said:</cite>
I answered this question twice. I used FII and then I didn’t!! So I hope I get marks for the one I did. They can’t mark down for doing a question twice can they?No ACCA don’t use negative marking
<cite> @confused1 said:</cite>
Did anyone add FII to the corp tax question?Yes the dividend from Be Ltd as this was only 40% shareholding so not an associate. Did you?
<cite> @faranjamal said:</cite>
There were 4 in the group, because the only rule is >50% shareholding. Residence status is irrelevant.
So that makes 3 associated companies + 1 the parent itself.I got that there were 4 in the group too
<cite> @charlotteo said:</cite>
I got that the impairment was disallowable: in order for bad debt relief to be claimed, 6 months atfer the DUE date must have passed. It was due in October I think and so April would have been the earliest that bad debt relief could be claimed. This was the VAT return for the ¼ ended March so bad debt relief could not yet be claimed.Oh that’s good then as that it was I thought. Thanks for clarifying
<cite> @atab said:</cite>
How did the second one get full rollover relief? Isn’t is restricted to the difference between proceeds and amount reinvested?Yes I put it as restricted too as all of the sale proceeds were not re-invested. I think I got a chargeable gain of £12,000 on warehouse two.
<cite> @atab said:</cite>
6 months did pass…..the receivable was due mid september…..it was written off end of March….that is 6 and a half monthsI wasn’t sure as I wasn’t sure if it was from the date of the invoice Sep or the date the payment was due Oct. Knew I’d get it the wrong way around. Thanks
<cite>@danf1981 said:</cite>
Yup the NRB was supposed to 325000 as it was when the guy died. You’d only use the 300000 when he was alive and when he makes donations into a trust (comp 1)Yes this is exactly what I did
<cite> @mahoysam said:</cite>
I am hundred percent sure that NRBs are used on PETs!Yes I used the nil rate band for the death tax calculation of £325,000 but didn’t use it in the lifetime question i.e the nil rate band given in the question for the 2008/09 tax year.
Confused – no I didn’t use it as it was a PET. I did at first and then realised it was wrong.
vipulv – no not a stupid question at all – the amount of output vat was states and yes I included £50 of output vat for the fuel scale charge (£300/6) and also excluded the sale to be w/off as 6 months hadn’t passed. Not sure if I’m right or not.
Yes you’re right to include the sales proceeds on disposal but for motor car 3 i used the cost as the disposal proceeds rather than the sale proceeds as the sales proceeds were more than the cost. Again not sure if that’s right.
Re: Q1 I also added back the mileage to and from work @ 60p as this is disallowable, I think I got £708
Just look at my notes and yes I think you do have to deduct the employer’s pension contribution from the salary… oops I didn’t do this but hopefully it would have only been a mark.
Charlotte – I had the same workings for you £10,000 unused annual allowance and brought these forward plus the £10,000 for 2012/13. Therefore, additional pension contribution of £40k added to the pension paid in year of £40k so I extended the basic rate band by £80k, not sure if that was right?
Mort112 – I added on £717 to her employment as a benefit of the extra mileage and yes excluded the charity donation as this included advertising.
I didn’t have a clue how to calculate the shares bit. I didn’t know whether to deduct the pension from the employment income either so I just left it.
Also with questions 1 I ranked them in the order that they were i.e highest cont was C then it was S and then D… did anyone else get this?
Q1 – I also got around £1.7 m for the break even Revenue
Q2 – I thought this was okay but I couldn’t seem to work out the standard hours worked x the standard rate.
I got a really big variance too and this put me off as I thought it must have been wrong! I was then struggling to comment as I thought that my variances were wrong!
Q3 – I thought this was okay but I don’t think I wrote enough for the 20 marks (only 2 pages)
Q4 – I didn’t really know what a rolling budget was (although I should have revised this) I found it quite hard to comment on appropriate incentive schemes as I didn’t even know that this was in the syllabus? I suggested that bonus scheme should be as a whole rather than individual managers assessed.
Q5 – I just couldn’t get my head around transfer pricing and even the simple ABC I struggled with so think I may have lost marks there. It confused me how they had to overheads relating to machines, I think it was machine production runs and machine maintenance costs. I wasn’t sure how to work out the exact cost driver, was it mach hrs x prod runs x units?
This was a very discursive paper and overall I don’t think that I’ve done enough to pass but fingers crossed.
I’m gutted learning curve didn’t come up!