*** P6 December 2012 Exam *** Instant Poll and comments***

with reference to your comment cifaman, you got me wrong. Exams are supposed to be tough..that is how you are going to create worth for yourself if you overcome a diffcult hurdle..

The thing where I did a mistake is I included that xyz company profits in trade asset calculation arghh :@

Secondly can anyone tell me IHT calculation question ?.
One trust gift ( with no info I assumed it was covered by reliefs , assumptions and bands )
Secondly share were charged to IHT in foreign country
I just added all 4 things to estate like home , cash , shares etc , used full NRB .. Then 40 % tax deducted dTr on shares .. Is that ok or there was another way ?

Also, for Q2 I did:

Set out the basis periods – 1 three months to April, 2 the whole 9 months again and had to force a 12 month period so add 3/12 of the loss but was still a profit 3 take the remaining 9 months of loss only as can’t do this twice unlike overlaps.

Then I set up a proforma for each yeah of income to see what income she had.

I explained she could do current year, or carry back in any order, but as one year wa under brb would only get relief at 20% the other year was only little bit over so not much relief.

I also explained she could set against cgt but only after making a full claim against total income and as that exceeded the loss, there would be nothing left to do this.

I then talked about opening year relief and that losses in the first 4 years can be carried back 36 months on a fifo basis so it would go back to the year before she started trading this year had the most income over the brb anyway so would provide the most loss relief.

Even if i got my calcs etc wrong I think just stating those 4 main options and explaining them would give a lot of marks so if you did that u wouldn’t worry too much about it 🙂 I’m sure people did better than they thought.

Overall I thought Q1 wa horrible, but there was a fair few cgt calcs in there which may give you more marks than you think, and I couldn’t do the regrouping charge as it totally went out of my head but I did explain why it’s charged and it increases the proceeds so hopefully a Mark even though I didn’t actually include it in the calc!!

OMG…what a paper. Qn1 and 2…really? Why do they keep doing this to us? And i hate this ‘no experience no passing nonsense’. They shouldn’t be taking our money if they clearly know we have no experience to pass the paper. It should be clearly highlighted when booking for such exams that we wont pass unless we have the experience,otherwise this aint fair.

Rehan – no double tax treay just mens there is no restrictions on the tax allowed – so revert to the UK rules, which is that tax relief is allowed at the lower of uk tax applicable to that asset, and the foreign tax that was paid, because the foreign tax was lower, take this.

no double tax treaty doesnt mean no tax relief is allowed, i tripped up on this on one of the practise questions so remembered it in the exam, but probably wasnt worth more than 2 marks anyway

Regarding question 2 and carry back of losses made in the first 4 years of trading, did anyone apportion the property business profits across the tax years. I just took it that property business profits for 2009/10 were the actual profits for tax year 2009/10, etc. I hope that was right and we weren’t supposed to apportion the profits from April to March.

Looks like the paper has been published folks: https://www.accaglobal.com/content/dam/acca/global/PDF-students/acca/p6/exampapers/uk/p6uk_2012_dec_q.pdf

@haylee69 said:
I’m pretty sure there was details on the gift to trust – it said uk shares to the value of £320000? On q4 there were no details so had to assume but there was a line on q5 else you wouldn’t have been able to work out the IHT?

Yes I know Abt 320000 so ? How much tax was paid ? Gross chargeable transfer ? I can’t see any such thing ? Can u correct me ? And where bands are required they are given in exams

You take the gift in life and take off the current year and prior year annual exemptions of £3000 to leave a net gift of £314000. Then you take off the NRB available in 2007 and the excess is charged at 25% to give the lifetime tax payable. As the donor paid the tax this is added to the £314000 to get the gross gift.

Then on death you need to revisit as it was within 7 years but now the NRB has increased to £325000 so it covers the gift and leaves a small amount left over in the death estate.

That’s what I did anyhoo!!

@haylee69 said:
You take the gift in life and take off the current year and prior year annual exemptions of £3000 to leave a net gift of £314000. Then you take off the NRB available in 2007 and the excess is charged at 25% to give the lifetime tax payable. As the donor paid the tax this is added to the £314000 to get the gross gift.

Then on death you need to revisit as it was within 7 years but now the NRB has increased to £325000 so it covers the gift and leaves a small amount left over in the death estate.

That’s what I did anyhoo!!

Hmm you are right but I read in exam kit we will always have nrbs of different years when required , here it wasn’t given so I believe there was no as such calculation involved. Again u r right but there was no info other then gift and exemptions. So I used full NRB in death IHT

@haylee69 said:
All NRB are given in the rates tables at the start of the exam question paper they sometimes put on the question also but are there for the last ten years

Oh sorry I didn’t check then you are right ..

A very difficult paper.
ALL the optional papers should be of the same standard. For e.g papers P4 or P6 cannot be more difficult than paper P7.

@olkos said:
@nicolas03 do you (or anyone else) knows how we can leave feedback for this exam on the official acca website?

i am really hoping we can convince the markers that they should consider how hard the questions were and possibly ease up their strictness when marking our poor papers???

thanks guys!

I don’t want to sound flippant towards yours and any other persons POV on this paper but really? It’s a pro paper they are supposed to be hard. And TBH I don’t think you’ll get anywhere where there being a relaxed marking scheme because P6 is not that sort of paper.

The whole tax system is rule based – you either know the rules and where to apply them or you don’t, how can you relax a marking system to accomodate this?

Again I don’t want to sound flippant but I’ve had a look at the paper and it really is not that bad. Having experience of working in tax does help of course but ultimately you should have built up your knowledge through the study text and practised your application of this knowledge through doing PPQ’s.

Ask your fellow colleagues or friends how much work they put in to pass. As a benchmark for me it was roughly 120 hours and 86 PPQ’s and even then I only got a mark in the mid 50’s (but I did study and pass P2 and P3 as well in the same diet).

I’m saying this for everyone’s benefit as the saying goes ”You can fail many times, but the moment you blame something else for your failings is when you truly fail.”

Good luck with the results and (if applicable) the resit.