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Q4 was good question. The rest were tricky in places. Hated Q2. Incorporation relief. Q1 about relieving losses and Q5 part a about winding up was OK.
overall paper was good except Q 2, as it was little tricky and make me confused due to unusual residence status,rest of paper was ok.
I too found this paper so much easier than the June one. At least I understood what they were asking me, even if I might have got it wrong.
I’m kicking myself about question 1. When I got home I realized my mistake. I went to great lengths explaining that the loss should be transferred to the company with the highest marginal tax rate, and listed all the rates for each eligible company. Then I went ahead and assigned the loss to the lowest marginal rates! I hope the examiner will have pity on me!
The June exam I decided to give up near the beginning and just sat there for 10 minutes. Then I got bored, and decided to have a half hearted stab at it. I couldn’t believe I was only 2 marks off the past mark!
I always found myself writing but never quite sure if I was answering what they wanted… will hope for the best but think I’ll be lucky to pass. Very disheartening as I worked so hard and learned so much. I just didn’t get through enough past papers 🙁
I understood that the question was asking the tax implications on the sale. I think the gain accruing after April 2015 will be taxable by time apportionment or the cost based on market value at April 2015.
Can someone confirm which entities were required to pay by instalments in Q1 and what the profit threshold was? 375K?
What was your answer to the below?
“Can someone confirm which entities were required to pay by instalments in Q1 and what the profit threshold was? 375K?”
@ meester I thought there were 6 associated companies with effective interest of more than 50% and the threshold was 250k accordingly. I thought the company which was acquired during the year (may be.. Chad Ltd.) needs to make payments in installments due to having higher profits than threshold.
What was additional Investment amount to cover the chargeable gain for Rollover Relief in Ist part of Q-1?
I excluded Chad which i now realize was probably a mistake.
My answer was initially 20k, but then i reduced it by 16k due to the assets qualifying for relief acquired by one of the other subs. Total was therefore 4k.
I thought the paper was overall ok but hated question 2 but had enough time at the end to revisit and put more in it, just hope I have done enough
To be completely honest, I actually never expected the entire paper to be relatively easy
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- Replies: 13
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whole P6 Exam
1. Group structure Hltd 100% owner or J Ltd, F Ltd., C Ltd, S Ltd, L Ltd and 30% owner of another company. All UK Resident
F Ltd has trading loss of £540000. Chargeable gains of £65000, Capital loss £31000 and asset qualifying for Rollover relief £14000. Proceeds on disposal £125000 which was invested in asset bought.
1. Calculate chargeable gains for Fltd and advise on maximum reinvestment of the proceeds so that the gain arising is covered by the capital loss. I got £80000 reinvestment and nil chargeable gains as ROR was £51000.
1a. Relieving the loss in F Ltd in the most beneficial way. As all the companies are large and pay CT in instalments.
Profits in HLtd £180k
L ltd £375k
J ltd 410k
C ltd which only joined the group in 1 sept 2016 profits £675k
S ltd profit £30k and capital loss £48. Net loss 8k
1b. VAT refund has been given to HLtd but no reason as to why
1c.Group registration of VaT. All make standard rated supplies but only F Ltd is partial exempt trader and S Ltd uses Cash accountinh and annual accounting scheme2. Wavereley
40 year old divorced with 2 children
Higher rate tax payer
Runs a sole trade since 1 March 2008
Wants to cease trade by incorporating a company Roller Ltd. Then Shares will be disposed off for £600k.
Value of assets held in sole trade is £540000 and capital gains in respect of assets £160k and goodwill £30k.
Shares issued in Roller Ltd 270000shares at £1each
He wants to leave UK and settle overseas after 5 April 17. His only home in UK will be disposed and gain arising covered by PPR. He will buy a new home overseas but wants to return to UK to visit his children
He also has an investment property which he will sell and give to his sister
1. Unicorportated business basis period
Profits allocation
Y.e 30 June 2016 £125600
P.e 15 Jan 2017 £74230
Give reason for
Further information required
explain
Incorporation relief claim beneficial or not
Max no of days can he stay in UK to maintain Non Uk resident status
Why is it Better to be non resident in 17/18. Shares acquired in Roller ltd to be sold 6 months after acquistion
Inheritance tax and capital gains tax implications on investment property disposed whilst Overseas and proceeds gift to sister. No gift relief available4. Company share option scheme vs Employee Shareholder scheme
Compare and contrast tax implications on disposal of shares for Simon and Methyl ltd.
Simon Director of Methyl ltd
Additional rate taxpayer
£25000 shares worth to be awared in 16/17 tax year
4b. Company car vs beneficial loan
£9600 car value when given to employer which is £800 lower than list price
Diesel car emission 108g/km
Contributions towards car running costs by employee Chris £700
Chris is a higher rate taxpayerBeneficial loan
£9600 interest free
Repaid in 3yrs4c. Yara has overseas rental income £24000
Salary £80000
Remits £15000 rental income each year
Uk resident since 1 April 2008
Why is it not beneficial to claim remittance basis in 15/165a. Winding up of a limited company
State Ct implications?
I Forgot to say no Ct on winding up
How can profits be distributed to the A ltd shareholder 30% held by Alan
70% held by M ltd. Is it better to distribute profits before winding up or after?5b. C ltd has trading losses in the year ended 30th June 16 and 31st march 17
Of £64000
How best to relieve it and what amount will be unrelieved.
Vat implications on cessation- Topics: 0
- Replies: 13
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1. Group structure Hltd 100% owner or J Ltd, F Ltd., C Ltd, S Ltd, L Ltd and 30% owner of another company. All UK Resident
F Ltd has trading loss of £540000. Chargeable gains of £65000, Capital loss £31000 and asset qualifying for Rollover relief £14000. Proceeds on disposal £125000 which was invested in asset bought.
1. Calculate chargeable gains for Fltd and advise on maximum reinvestment of the proceeds so that the gain arising is covered by the capital loss. I got £80000 reinvestment and nil chargeable gains as ROR was £51000.
1a. Relieving the loss in F Ltd in the most beneficial way. As all the companies are large and pay CT in instalments.
Profits in HLtd £180k
L ltd £375k
J ltd 410k
C ltd which only joined the group in 1 sept 2016 profits £675k
S ltd profit £30k and capital loss £48. Net loss 8k
1b. VAT refund has been given to HLtd but no reason as to why
1c.Group registration of VaT. All make standard rated supplies but only F Ltd is partial exempt trader and S Ltd uses Cash accountinh and annual accounting scheme2. Wavereley
40 year old divorced with 2 children
Higher rate tax payer
Runs a sole trade since 1 March 2008
Wants to cease trade by incorporating a company Roller Ltd. Then Shares will be disposed off for £600k.
Value of assets held in sole trade is £540000 and capital gains in respect of assets £160k and goodwill £30k.
Shares issued in Roller Ltd 270000shares at £1each
He wants to leave UK and settle overseas after 5 April 17. His only home in UK will be disposed and gain arising covered by PPR. He will buy a new home overseas but wants to return to UK to visit his children
He also has an investment property which he will sell and give to his sister
1. Unicorportated business basis period
Profits allocation
Y.e 30 June 2016 £125600
P.e 15 Jan 2017 £74230
Give reason for
Further information required
explain
Incorporation relief claim beneficial or not
Max no of days can he stay in UK to maintain Non Uk resident status
Why is it Better to be non resident in 17/18. Shares acquired in Roller ltd to be sold 6 months after acquistion
Inheritance tax and capital gains tax implications on investment property disposed whilst Overseas and proceeds gift to sister. No gift relief available4. Company share option scheme vs Employee Shareholder scheme
Compare and contrast tax implications on disposal of shares for Simon and Methyl ltd.
Simon Director of Methyl ltd
Additional rate taxpayer
£25000 shares worth to be awared in 16/17 tax year
4b. Company car vs beneficial loan
£9600 car value when given to employer which is £800 lower than list price
Diesel car emission 108g/km
Contributions towards car running costs by employee Chris £700
Chris is a higher rate taxpayerBeneficial loan
£9600 interest free
Repaid in 3yrs4c. Yara has overseas rental income £24000
Salary £80000
Remits £15000 rental income each year
Uk resident since 1 April 2008
Why is it not beneficial to claim remittance basis in 15/165a. Winding up of a limited company
State Ct implications?
I Forgot to say no Ct on winding up
How can profits be distributed to the A ltd shareholder 30% held by Alan
70% held by M ltd. Is it better to distribute profits before winding up or after?5b. C ltd has trading losses in the year ended 30th June 16 and 31st march 17
Of £64000
How best to relieve it and what amount will be unrelieved.
Vat implications on cessation- Topics: 0
- Replies: 13
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1. Group structure Hltd 100% owner or J Ltd, F Ltd., C Ltd, S Ltd, L Ltd and 30% owner of another company. All UK Resident
F Ltd has trading loss of £540000. Chargeable gains of £65000, Capital loss £31000 and asset qualifying for Rollover relief £14000. Proceeds on disposal £125000 which was invested in asset bought.
1. Calculate chargeable gains for Fltd and advise on maximum reinvestment of the proceeds so that the gain arising is covered by the capital loss. I got £80000 reinvestment and nil chargeable gains as ROR was £51000.
1a. Relieving the loss in F Ltd in the most beneficial way. As all the companies are large and pay CT in instalments.
Profits in HLtd £180k
L ltd £375k
J ltd 410k
C ltd which only joined the group in 1 sept 2016 profits £675k
S ltd profit £30k and capital loss £48. Net loss 8k
1b. VAT refund has been given to HLtd but no reason as to why
1c.Group registration of VaT. All make standard rated supplies but only F Ltd is partial exempt trader and S Ltd uses Cash accountinh and annual accounting scheme2. Wavereley
40 year old divorced with 2 children
Higher rate tax payer
Runs a sole trade since 1 March 2008
Wants to cease trade by incorporating a company Roller Ltd. Then Shares will be disposed off for £600k.
Value of assets held in sole trade is £540000 and capital gains in respect of assets £160k and goodwill £30k.
Shares issued in Roller Ltd 270000shares at £1each
He wants to leave UK and settle overseas after 5 April 17. His only home in UK will be disposed and gain arising covered by PPR. He will buy a new home overseas but wants to return to UK to visit his children
He also has an investment property which he will sell and give to his sister
1. Unicorportated business basis period
Profits allocation
Y.e 30 June 2016 £125600
P.e 15 Jan 2017 £74230
Give reason for
Further information required
explain
Incorporation relief claim beneficial or not
Max no of days can he stay in UK to maintain Non Uk resident status
Why is it Better to be non resident in 17/18. Shares acquired in Roller ltd to be sold 6 months after acquistion
Inheritance tax and capital gains tax implications on investment property disposed whilst Overseas and proceeds gift to sister. No gift relief available4. Company share option scheme vs Employee Shareholder scheme
Compare and contrast tax implications on disposal of shares for Simon and Methyl ltd.
Simon Director of Methyl ltd
Additional rate taxpayer
£25000 shares worth to be awared in 16/17 tax year
4b. Company car vs beneficial loan
£9600 car value when given to employer which is £800 lower than list price
Diesel car emission 108g/km
Contributions towards car running costs by employee Chris £700
Chris is a higher rate taxpayerBeneficial loan
£9600 interest free
Repaid in 3yrs4c. Yara has overseas rental income £24000
Salary £80000
Remits £15000 rental income each year
Uk resident since 1 April 2008
Why is it not beneficial to claim remittance basis in 15/165a. Winding up of a limited company
State Ct implications?
I Forgot to say no Ct on winding up
How can profits be distributed to the A ltd shareholder 30% held by Alan
70% held by M ltd. Is it better to distribute profits before winding up or after?5b. C ltd has trading losses in the year ended 30th June 16 and 31st march 17
Of £64000
How best to relieve it and what amount will be unrelieved@Suhail, I am somewhat glad I see the limits divided by number of qualifying companies in the group. I was self studying from the book with rates valid until the June 2016. I knew the rates will change from this sitting but thought of reading acca update on the changes and was confident that in the exam can just use new rates given in the first few pages. But I have to say, half way through the q1 i realised corporation tax rate was flat of 20% and nothing about marginal rate or standard fraction. It threw me slightly off, making me think that not uust rate changed but the whole way the ct is computed. Can anyone confirm that? Are there still upper and lower limits? That would probably save me few points and any chances of passing.
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Losses can only be surrended to chad ltd and Hahn ltd. As chad ltd was acquired during the yr so his profits needs to be time apportioned 7 months
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- Replies: 14
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Let’s discuss on paper one of friend has shared whole paper
Who remembers clearly the question breakdown for question 3 ?
I’m only remembering
Related property husband + wife shares . Gifting in 2013 or 2016 to daughter
Then the other one regarding change in cessation date 28/02 or 30/04
Was there another part of the question ?
Hi all. I might have missed something but I have a quick question regarding “Taxes and allowances” section of the question book. This time, for CIT the rates indicated just one rate – 20% without any lower and upper limits affecting tax rates. This confused me as I don’t remember any changes in this area in FA 2015.
Thanks, chulbulla. Was this announced somewhere? I’ve read through the article on changes made by FA2015 and have not seen such change.
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Hi, Any one selling P6 Advance Taxation note or study material in Singapore Variant? I am planning to sit on March 2017 exam but i don have friends taking this paper. Or any suggestion where can i get the note or study material.
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