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- This topic has 38 replies, 19 voices, and was last updated 4 years ago by nickseaw.
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- December 4, 2019 at 6:50 am #554812
@nieffee said:
Hey guys. Sorry still thinking about the exam and that 15 out of 20 years , suddenly thinking isn’t there a clause that means Something like ….If there is no tax year beginning after the 5 April 2017 and before the relevant tax year in which there were a UK resident, then the condition wouldn’t be satisfied?
First condition is 15 out of 20 tax years ending the previous tax year.
The second condition is one year uk resident in the last 4 tax years ending with current tax year.
December 4, 2019 at 9:44 am #554844The exam was hit and miss to be fair. Question 1 wasn’t great. I think I read it several times which didn’t help the cause. Anyways my biggest gripe is that we started the exam half an hour late due to the invigilators coming late. And the hall in where we sat our exam was absolutely freexing. The boiler stopped working the night before. Everyone was complaining and I couldn’t write for too long because my hands started seezing up from the cold. I went to the toilet 4 times during the exam to defrost my hands under the blow dryer lol. Don’t think it’s anyone’s fault but when it’s one of your final exams you don’t want any distractions especially the coldness
Anyways best of luck to everyone! Hope you all smashed itDecember 4, 2019 at 10:47 am #554854P6 – was a horror movie 🙁
December 4, 2019 at 10:58 am #554856Well that was a hard exam to be fair!!! Few points that i want to speak about as i have been thinking about it all night and i need to let it out and see what other people wrote:
Q1) Sole trader VS Limited company – Did people say that he would be taxed at a higher rate if trading as a sole trader and then speak about the different rate bands whereas for a limited company he would be taxed lower at 19%. I also said if he was sole trader he would get the £11,850 PA.
I also said that dividends would not be taxable in the Limited company.I did not know what else to write!!!
In regards to the VAT question about claiming back VAT on impaired debt i said if it is 6 months late and he has written it off in his books he can claim back the VAT.
Q4) VAT – Capital goods scheme – I was confused here but explained that it should be part of the CGS as the building was >£250K and i worked out the initial input VAT recovery at 20% (full recovery) and at the sale, no VAT was charged so that was 0% and so he had an amount to pay to HMRC ???????
Q2) IHT – For the gift of the unquoted shares, did people work out the VALUE of this gift (By doing calculation of before and after gift shareholdings and multiply it by the relevant percentage) and then explained that there would be additional tax if Emma died within 7 years and just gave an example of the maximum IHT due if she died in 1 year…
Did anyone say anything about Business property relief being available as the shares were unquoted?
Best of luck to all!!!
December 4, 2019 at 1:21 pm #554873Yes, pretty much I did the same, for Q1 -sole trader I used opening year rule to find out the trading profit for both years.
Than I did the income tax for the company case and compare the two taxes.
The bad debts VAT , yes is correct 6 month late when the bad debts is w/off. To improve cash flow- cash accounting scheme is preferable.
Capital goods scheme is right, but I calculated the Annual Adjustment VAT/10* (% year 2- %Year one ) and because it was a fall in % was a repayment to HMRC.
IHT question – yes it was a gift of unquoted shares so I did the calculation of diminuation value /combine with her husband. Value before gift less value after gift – I found out the taxable gift.
Then I said the BPR relief will apply because is a trading asset and was help for 12 months ( the % of shares doesn’t matter for unquoted shares ) is I remember well.I am not sure is correct but I hope I did enough to pass.
What did you say about patent roll over relief- I got confused as I know roll over relief is available for fixed assets ( qualifying assets as buildings, fixed plant and machinery ) so I am not sure what I was supposed to say.
I just mentioned there is a 4% cost allowance the company can claim annually.
The questions were not easy but much better than June 19 when I failed, so I really hope I am done now with tax.Best of luck
December 4, 2019 at 1:44 pm #554888Capital goods scheme, no repayment to HMRC for the first few years when used as wholly for trade purposes. 1/10 repayment back to HMRC each year for the years when it was let out (not used at all for trade purposes). On sale, repayment of 3/10 of input VAT claimed as I think it was sold after 7 years of ownership.
BPR applicable if and only if her son keeps hold of the shares at the time of her death. If he sells the shares and do not reinvest the proceeds in relevant business assets, the full death tax will apply if she dies within 3 years of gift and taper relief accordingly for surviving between 3 to 7 years of gift
Well that’s what I put down anyways.
December 4, 2019 at 2:07 pm #554897@gaby12 said:
Yes, pretty much I did the same, for Q1 -sole trader I used opening year rule to find out the trading profit for both years.
Than I did the income tax for the company case and compare the two taxes.
The bad debts VAT , yes is correct 6 month late when the bad debts is w/off. To improve cash flow- cash accounting scheme is preferable.
Capital goods scheme is right, but I calculated the Annual Adjustment VAT/10* (% year 2- %Year one ) and because it was a fall in % was a repayment to HMRC.
IHT question – yes it was a gift of unquoted shares so I did the calculation of diminuation value /combine with her husband. Value before gift less value after gift – I found out the taxable gift.
Then I said the BPR relief will apply because is a trading asset and was help for 12 months ( the % of shares doesn’t matter for unquoted shares ) is I remember well.I am not sure is correct but I hope I did enough to pass.
What did you say about patent roll over relief- I got confused as I know roll over relief is available for fixed assets ( qualifying assets as buildings, fixed plant and machinery ) so I am not sure what I was supposed to say.
I just mentioned there is a 4% cost allowance the company can claim annually.
The questions were not easy but much better than June 19 when I failed, so I really hope I am done now with tax.Best of luck
I am not sure about the patent roll over relief to be honest – I just said that the company will be able to claim roll over relief if it re-invests in a replacement asset within 3 years after selling old etc… NOT SURE?????
Did anyone do for part C the sale proceeds of the patent less the (60K Cost – 60K TWDV) and say the tax will be on that amount???
December 4, 2019 at 2:09 pm #554898@gaby12 said:
Yes, pretty much I did the same, for Q1 -sole trader I used opening year rule to find out the trading profit for both years.
Than I did the income tax for the company case and compare the two taxes.
The bad debts VAT , yes is correct 6 month late when the bad debts is w/off. To improve cash flow- cash accounting scheme is preferable.
Capital goods scheme is right, but I calculated the Annual Adjustment VAT/10* (% year 2- %Year one ) and because it was a fall in % was a repayment to HMRC.
IHT question – yes it was a gift of unquoted shares so I did the calculation of diminuation value /combine with her husband. Value before gift less value after gift – I found out the taxable gift.
Then I said the BPR relief will apply because is a trading asset and was help for 12 months ( the % of shares doesn’t matter for unquoted shares ) is I remember well.I am not sure is correct but I hope I did enough to pass.
What did you say about patent roll over relief- I got confused as I know roll over relief is available for fixed assets ( qualifying assets as buildings, fixed plant and machinery ) so I am not sure what I was supposed to say.
I just mentioned there is a 4% cost allowance the company can claim annually.
The questions were not easy but much better than June 19 when I failed, so I really hope I am done now with tax.Best of luck
OOOPS for the IHT calculation, i worked out the value by doing only Emma’s shareholding before the gift multiplied by the Price of the % of shareholding ( I think it was like 50%) less the Price with the % holding after the gift (I think was 35% less)…
December 4, 2019 at 4:55 pm #554943Yes, I said something about TDWV, but I was not sure if is balancing charge or allowance. I think I said is charge.( I was so stressed )
I asked a colleague in tax department and she said the patent will be allowed for rollover relief if as you said the amount will be reinvested in a qualifying asset 12 months prior to or 36 months post the sale. ( the non qualifying assets apparently are the ones you can claim Capital allowances). I think you need to work in a tax department to pass this exam 🙁December 5, 2019 at 3:00 am #554995AnonymousInactive- Topics: 0
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Hi everyone. Exam was very time pressured. I feel the style of the questions have changed compared to previous years.
I mentioned BPR would not be available as her son was not Uk resident at the time of the gift!For the other question Not deemed Uk resident even though been in the uk for more than 15 out of 20 years because has not been resident from tax 2017/18 onwards.
Question 1 it already mentioned bad debt so using cash accounting scheme whereby revenue is only recognised on cash received in bank no bad debt would occur as accounts have NOT been prepared on an accrual basis. Very confusing question 1 .. so many different details and years in that question.
Question on patent ROR was another struggle
All the best everyone for the results!
December 5, 2019 at 10:52 pm #555219AnonymousInactive- Topics: 0
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Hi can anyone please remember the marks distribution in each question?
December 6, 2019 at 8:26 am #555238It was a train wreck!!!! Hated every minute of it and I can’t help but think it scouted around the key topics and went off on tangents! Definitely a retake here!
December 6, 2019 at 3:44 pm #555320AnonymousInactive- Topics: 0
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Question paper is out already on accaglobal
December 6, 2019 at 8:07 pm #555364@haidernchd said:
Question paper is out already on accaglobalWell looking at the exam paper again, I attempted 85% of the paper. If I get 60% of the 85% I attempted, I should be ok.
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