*** ACCA P6 June 2018 Exam was.. Instant Poll and comments ***

Disaster for me, was not fully prepared for this exam, got to prepare for a resit in sept.

Another disaster here! My first ACCA exam and I think I’ll be lucky to get 30 marks 🙁

I completed an ACCA accredited degree last year so still have a decent knowledge of the UK tax system and gave myself a good refresh over the last few months but my mind goes blank when reading exam questions!

@dskinner83 said:
I did the UK version, and it was hard but I would say on the fair side of hard.
Question one would have thrown me had I not done s couple of questions in practice this week that were fairly similar in method, although I’m still not sure I got it right.

The VAT threw me a bit, I felt like I had to do something with regard to partial exemption but it didn’t feel like there was enough information to do it properly. In the end, I looked at what the overall VAT recovery would be, and the non-recoverable bit and concluded that Strategy A would be De Minimis but Strategy B would not so there would an extra cost in the input VAT that wasn’t recoverable.

Got a couple of bits wrong re: the statutory redundancy pay and recoverability of gift relief, so now crossing my fingers that I didn’t make any other glaring errors that will have lost lots of marks!

Had about ten minutes left at the end and ended up rewriting my last but to question 1 because I’d made such a mess of it. Not sure I’m going to get many professional marks for presentation!!

Not sure what other people thought, but I quite liked the fact there was no question choice, it meant there was no time wasted deciding which questions to do and no regrets afterwards thinking I’d picked the wrong one.

I had no idea what to do with the partial exemption bit. They gave us the % so I knew it was involved but I had no seen a question like before so had to guess. I think that’s my problem with ACCA exam questions compared to university exam questions, no two are alike…

Also, mentioned the statutory redundancy was exempt but reduced the £30,000 limit but said that ex gratia and laptop were fully chargeable. No idea on gift relief either as I hadn’t seen cessation mentioned in any past questions although I knew it was only available on qualifying business assets but remembered that there was a 3 year since cessation rule for something.

I’d love to have the choice. I’m great with IHT and VAT but hate CGT and CT so hopefully having a choice would allow me to focus on one of the taxes that I like.

@ddmoo said:
UK Verison.

Q1 went really badly for me. I spotted a few things wrong with the IHT computation (Taper relief should be done on IHT amount and not PET value and they forgot to include AEA) but had no idea what to do with the value of the PET. I think it should have been the difference between the MV and the price paid but concluded no matter what it was it would be covered by the NRB anyway. The expansion part went badly. Got the easy marks from the NIC charges and said they could recover the input tax on the overheads and sub contractor costs. Wrote a whole page on De Minimis only to then scrap the idea. Would be happy with 15 marks on Q1 (ethics and professional marks should be me over half of that).

Q2, 3 and 4 I felt went really well for me, a lot of stuff I knew very well. I remember skimming through at the start of the exam and seeing a question on CFC and thinking well that’s lost marks there already, turned out to be the easiest marks of the exam.

Expecting anywhere between 40 and 60 marks.

RE: Q1, I think it said that there was a GCT which used most of the NRB as it was made within the 7 years before the gift.

Nice to hear you did well on the other questions, good luck!

Also, take what I say with a pinch of salt, my head was gone after about 15 minutes into the exam!

Ah, think I may be mixing up some of the questions. I started with Question 3 and I think there was a gift in maybe 2014. The more I think about this exam, the more confused I get! Sorry for any incorrect information.

Well looking at all the comments. Makes me think I did a lot things incorrectly. No IHT to be computed in Q1 because it was not a gift. But he sold. No IHt on sale.

What about maximum pension contributions allowable to avoid charge in question 4?

q1: there was no IHT as the cottage was sold.
CGT: As it was sold to connected party MV should have been used?

first year max pension could be 3600 ( as no relevant earnings)
second year up to 40k plus c/f allowance from last year

@rogman228 said:
I sat the Irish variant.

It was hard as any high level tax exam is bound to be but if you knew your stuff and practiced enough past paper questions to learn then it become an okay exam.

I think it is a fair examiner. The exam is time pressured but still more than doable in the 195 minutes.

I highly recommend Julie from accountancy school if anyone is looking for tuition for the Irish variant. Her lectures and advice are brilliant.

Q2 was very, very similar in parts to a question asked in 2012 on revenue audits. If you practiced that one then you knew at least 3 of the 7 issues well enough to score full marks for this question I reckon. There were minor twist like I think the staff in issue 4 IIRC were low paid this time where they were high paid on 2012 so you used the lower tax rate. But that is all.

Some issues with the exam hall which I will leave for the ACCA feedback forum. We could hear girls on a school tour giggling at times during the exam making a lot of noise and then all the exits except the lift were closed off when leaving the exam. A normally excellent venue was disappointing this time.

Overall I gave it my best and have no regrets. Answered all parts, nothing scared me too much, etc. And the difficulty of the exam vs time was well balanced.

Irish variant too.

I thought it was an okay paper. Some tricky parts but I hope I have done enough to get me over the line!

I studied with Julie and I would absolutely recommend her to anyone

@paulcostelloe1000 said:
Hi all,

I sat the Irish variant too, however, I can’t seem to remember the questions very well.

Do you remember in Q1 the various transfers Lorraine was making i.e the business premises and apartment, would the transfer not have been tax free as they were between spouses ?

Then to follow on, the better option was two because if Charlie occupied the apartment for three years after the transfer he could sell it on then availing of PPR. Lorraine in turn could sell the business premises and avail of RR because it wasn’t practical for her to transfer the business premises to Charlie because he was only 36 and would have to wait 20 years for the relief.

What are your thoughts on this ? This requirement sent me all over the place, I couldn’t iron out was going on, I needed more time to think the scenario through.

Then the last 18 marks confused me too. Lorraine was able to utilise her remaining RR of 2,850,000, the value of the company was no where near that value so RR fully covered the liability.

Her favourite niece had 30k left as a class 1 threshold after using 280k from a gift from her mother and she availed for Business relief and there was no CAT liability.

Something must have went tits up with that question for me ?. I think I could have thrown it away on Q1. I didn’t remain composed.

I found it time pressured being honest. Time management is hard.

Thanks mate

I agree that Q1 was by far the hardest on the paper. And yes difficult to find the time to read it enough times to see if you missed any tricks. But it’s always the longest question hence why I done it last.

I actually started with Part 3 as I knew I would be less able to do part 2.

I did mention spousal exemption alright. But I also said that I assume Lorraine and Charlie will be living together (because otherwise it won’t be exempt from CGT if they don’t live together as husband and wife). I can’t remember anything in the question to say whether they lived together as husband and wife. As for the business premises I noted Loraine owned it personally. The point on PPR could be a good one for future use.

I was better at the 18 marker. The niece was a favorite niece so I did give her the group threshold 1 and I gave her business relief too because she’ll own 25% of the shares after the gift. I did also work out that the CGT was covered the remaining retirement Relief because a disposal to a child is limited to 3m when over 66 and it is a lifetime limit.

I also gave Loraine Entrepreneur Relief and used 10% CGT rate as a result.

After adding back the investments which aren’t allow for business relief and adding stamp duty I think I was left with a small but insignificant CAT liability for the niece.

I wouldn’t worry about it because sounds like you were indeed on the right track. If you also gave the rest of the exam a good stab you should be indeed safe.

@sonyam11 said:
No, at death it’s just gifts in the 7 years previous isn’t it

I believe so yes.

@ddmoo said:
I believe so yes.

Wasn’t the gift made in like 2014 originally or was that the other question . Can’t even remeber what I did but But if so The transfer was PET that becomes chargeable on death. Therefore the gross transfer was fixed on the 1 May 2014 or whenever the gift was and became chargeable when the woman died . So the Nil rate band would’ve been used when doing the initial calcualtion and only a bit was left . Think I got the final tax figure as 12k

@samthomas901 said:
Wasn’t the gift made in like 2014 originally or was that the other question . Can’t even remeber what I did but But if so The transfer was PET that becomes chargeable on death. Therefore the gross transfer was fixed on the 1 May 2014 or whenever the gift was and became chargeable when the woman died . So the Nil rate band would’ve been used when doing the initial calcualtion and only a bit was left . Think I got the final tax figure as 12k

Just read the textbook, PETs do not affect the NRB until they become chargeable. In the question it would have become chargeable on death.

Also sat the UK variant. Guys what did you write regarding the entrepreneurs relief? Was it available or not? Also did you use business property relief at all? I was not completely prepared but gave it my best shot.

@ddmoo said:
Just read the textbook, PETs do not affect the NRB until they become chargeable. In the question it would have become chargeable on death.

Ziti (Q20 in Kaplan) is a good example of what I think should have been done for the question in the exam. It shows the Inheritance tax payable on a PET at death. Before NRB available, it says “Gifts in 7 years before the gift (1.7.2007 – 1.7.2014). We were given the gross chargeable transfer amount in the exam so there’s no need to deduct the annual exemptions to show NRB available.

Good to know I’ve got 1 mark in the bag 🙂

@ddmoo said:
I believe (still not looked this up) the asset needs to be disposed of within 2 years of the cessation of business to qualify for ER so I said it would not be available. I didn’t write anything about BPR as I believe the question said it did not qualify for it.

Think it’s 3 years but I’ll check for us now

@samh88 said:
I’m glad I’m not the only one who was annoyed by the kids outside, it was really distracting. Also the room I was in the desks were facing a massive window with sun beaming in.

I noticed that about question 2 aswell so hopefully picked up some marks there, although I put deliberate behaviour for most of them because it seemed like clear tax avoidance.

I made a complete tits of the exam though so I’ll be resitting in December. Which is another annoying point, it’s not really fair that the Irish paper can only be sat twice a year!

Yeah absolutely ridiculous they thought it be a good idea to give screaming young kids a tour of the place when there is major exams going on. It definitely made it harder to concentrate when there is kids around screaming and laughing. What a joke. Thousands having to que up for the elevators (the one which actually were functioning!) because all other exits were blocked off was also embarrassing.

I put deliberate behavior for most as well because there was quite a lot of tax evasion going on in that question. The undeclared sales, staff bonus paid in cash left undeclared, and private motor expenses been put through the books, etc.

You probably did better than you expect. If you attempted everything then there is hope.

I believe the two sittings a year for our paper is due to a lack of resources. If I am not mistaken ACCA outsource our exam to the Irish Tax Institute and they write the paper, mark the scrips, etc. But I heard it’s only practical for them and ACCA to arrange it twice a year.

PS: Retirement Relief for the shares in Q1 with a 3,000,000 limit (less any used up) is because she was disposing to a Favorite Niece and Favorite Nieces are treated as a child for tax.