1. 
Chan died on 8 December 2014, having made a lifetime cash gift of £500,000 to a trust on 16 October 2013. Chan paid the inheritance tax arising from this gift. 

Who will be responsible for paying the additional inheritance tax arising from the gift made to the trust as a result of Chan’s death, and when will this be due?

2. 
Violet Ltd provides one of its directors with a company motor car which is used for both business and private mileage.For the quarter ended 31 March 2015, the total cost of petrol for the car was £600, of which 30% was for private use by the director. The relevant quarterly scale charge is £408. Both these figures are inclusive of value added tax (VAT).
What output VAT and input VAT entries will Violet Ltd include on its VAT return for the quarter ended 31 March 2015 in respect of the company motor car?

3. 
For the tax year 2014–15, Nog has a chargeable gain of £23,700 and a capital loss of £10,400. She has unused capital losses of £6,100 brought forward from the tax year 2013–14.
What amount of capital losses can Nog carry forward to the tax year 2015–16?

4. 
For the year ended 30 November 2014, Mixiness Ltd has taxable total profits of £1,380,000 and franked investment income (FII) of £240,000. Mixiness Ltd does not have any associated companies.
What is Mixiness Ltd’s corporation tax liability for the year ended 30 November 2014?

5. 
Which of the following statements correctly explains the difference between tax evasion and tax avoidance?

6. 
Quinn will not make the balancing payment in respect of her tax liability for the tax year 2013–14 until 17 October 2015.
What is the total percentage of penalty which Quinn will be charged by HM Revenue and Customs (HMRC) in respect of the late balancing payment for the tax year 2013–14?

7. 
Which classes of national insurance contribution is an employer responsible for paying?

8. 
Alice is in business as a sole trader. On 13 May 2014, she sold a freehold warehouse for £184,000, and this resulted in a chargeable gain of £38,600. Alice purchased a replacement freehold warehouse on 20 May 2014 for £143,000.Where possible, Alice always makes a claim to roll over gains against the cost of replacement assets. Both buildings have been, or will be, used for business purposes by Alice.
What is the base cost of the replacement warehouse for capital gains tax purposes?

9. 
For the tax year 2013–14, Willard filed a paper self-assessment tax return on 10 August 2014.
What is the deadline for Willard to make an amendment to his tax return for the tax year 2013–14, and by what date will HM Revenue and Customs (HMRC) have to notify Willard if they intend to carry out a compliance check into this return?
Amendment     Compliance check 

10. 
For the tax year 2014–15, Chi has a salary of £53,000. She received child benefit of £1,771 during this tax year.
What is Chi’s child benefit income tax charge for the tax year 2014–15?

11. 
Samuel is planning to leave the UK to live overseas, having always previously been resident in the UK. He will not automatically be treated as either resident in the UK or not resident in the UK. Samuel has several ties with the UK and will need to visit the UK for 60 days each tax year. However, he wants to be not resident after he leaves the UK.

For the first two tax years after leaving the UK, what is the maximum number of ties which Samuel could keep with the UK without being treated as resident in the UK?

12. 
 Which of the following are NOT deducted when calculating the value of a person’s chargeable estate for inheritance tax purposes?
(1) An outstanding repayment mortgage
(2) Funeral expenses
(3) An outstanding interest-only mortgage
(4) An outstanding endowment mortgage
(5) A verbal promise to pay a friend’s debt
(6) Credit card debts

13. 
Naomi is self-employed. For the year ended 5 April 2015 she made a trading loss of £110,000, having made a trading profit of £24,000 for the year ended 5 April 2014. Naomi also had employment income of £92,000 for the tax year 2013–14.
What is the maximum loss relief claim which Naomi can make against her total income for the tax year 2013–14?

14. 
Abdul’s tax liabilities for the tax years 2013–14 and 2014–15 are as follows:

What payment on account will Abdul have to make on 31 July 2015 in respect of his tax liability for the tax year 2014–15?

15. 
Ten Ltd is the parent company for a group of companies. The group structure is as follows:

Each percentage holding represents a holding of ordinary share capital.
What is the group relationship between Forty Ltd and Ten Ltd?

1.Zoe died on 17 February 2015. She had made the following gifts during her lifetime:
(1) On 7 March 2010, Zoe made a cash gift of £270,000 to her son as a wedding gift when he got married.
(2) On 21 June 2010, Zoe made a cash gift of £620,000 to a trust. Zoe paid the inheritance tax arising from this gift. 

Zoe’s husband had died on 25 July 2007, and 20% of his inheritance tax nil rate band of £300,000 for the tax year 2007–08 was not used.

The nil rate band for the tax year 2009–10 is £312,000, and for the tax year 2010–11 it is £325,000.

Required:

2.Luna Ltd had the following transactions in shares during the year ended 31 March 2015:
(1) On 29 November 2014, Luna Ltd sold its entire shareholding of £1 ordinary shares in Pluto plc for £53,400.Luna Ltd had originally purchased 16,000 shares in Pluto plc on 14 June 2008 for £36,800. On 22 May 2010,Luna Ltd sold 10,000 of the shares for £46,200. 
Retail price indices (RPIs) are as follows:
June 2008    216·8
May 2010     223·6
November     2014 257·0
(2) On 12 February 2015, Luna Ltd’s shareholding in Asteroid plc was taken over by Comet plc. Luna Ltd had originally purchased 10,000 £1 ordinary shares in Asteroid plc, and their indexed cost on 12 February 2015 was £33,000. 

Under the terms of the takeover, for each of its £1 ordinary shares in Asteroid plc, Luna Ltd received £6·50 in cash plus one £1 ordinary share in Comet plc. Immediately after the takeover, Comet plc’s £1 ordinary shares were quoted at £4·50.

Required:

3.You should assume that today’s date is 15 March 2014.
Fergus was born on 19 July 1971. He is currently self-employed, and if he continues to trade on a self-employed basis, his total income tax liability and national insurance contributions (NIC) for the tax year 2014–15 will be £33,985.

However, Fergus is considering incorporating his business on 6 April 2014. The forecast taxable total profits of the new limited company for the year ended 5 April 2015 are £100,000 (before taking account of any director’s remuneration). Fergus will pay himself gross director’s remuneration of £18,000 and net dividends of £40,000. The balance of the profits will remain undrawn within the new company.

Required:

4.Zim has been registered for value added tax (VAT) since 1 April 2005. The following information is available for the year ended 31 March 2015:

(1) Sales invoices totalling £126,000 were issued, of which £115,200 were in respect of standard rated sales and £10,800 were in respect of zero rated sales. Zim’s customers are all members of the general public. 
(2) On 31 March 2015, Zim wrote off two impairment losses which were in respect of standard rated sales. The first impairment loss was for £780, and was in respect of a sales invoice which had been due for payment on 15 August 2014. The second impairment loss was for £660, and was in respect of a sales invoice which had been due for payment on 15 September 2014.

(3) Purchase invoices totalling £49,200 were received, of which £43,200 were in respect of standard rated purchases and £6,000 were in respect of zero rated purchases.

(4) Rent of £1,200 is paid each month. During the year ended 31 March 2015, Zim made 13 rental payments because the invoice dated 1 April 2015 was paid early on 31 March 2015. This invoice was in respect of the rent for April 2015.

(5) During the year ended 31 March 2015, Zim spent £2,600 on mobile telephone calls, of which 40% related to private calls. 

(6) During the year ended 31 March 2015, Zim spent £1,560 on entertaining customers, of which £240 was in respect of overseas customers.

All of the above figures are inclusive of VAT where applicable. The expenses referred to in notes (4), (5) and (6) are all standard rated.

Zim does not use either the cash accounting scheme or the flat rate scheme. He has forecast that for the year ended 31 March 2016, his total sales will be the same as for the year ended 31 March 2015.

Required:

5.Retro Ltd’s summarised statement of profit or loss for the year ended 31 March 2015 is as follows:

Note 2 – Impairment loss
On 31 March 2015, Retro Ltd wrote off an impairment loss of £1,600 relating to a trade debt. This was in respect of an invoice which had been due for payment on 10 November 2014.

Note 3 – Leasing costs
The leasing costs of £4,400 are in respect of a motor car lease which commenced on 1 April 2014. The leased motor car has CO2 emissions of 145 grams per kilometre.

Note 4 – Other expenses
The figure of £205,160 for other expenses includes a fine of £5,100 for a breach of health and safety regulations,and legal fees of £4,860 in connection with the defence of Retro Ltd’s internet domain name. The remaining expenses are all fully allowable.

Note 5 – Interest payable
The interest payable is in respect of the company’s 5% loan notes which were repaid on 31 July 2014. Interest of £9,600 was paid on 31 July 2014, and an accrual of £3,200 had been provided for at 1 April 2014. The loan notes were issued in order to finance the company’s trading activities.
Additional information
Plant and machinery
On 1 April 2014, the tax written down value of the plant and machinery main pool was £39,300.
The following vehicles were purchased during the year ended 31 March 2015:

Previous results
Retro Ltd commenced trading on 1 September 2012. The company’s results for its two previous periods of trading are as follows:

Future results
Retro Ltd is expected to return to profitability in the year ended 31 March 2016 and to continue to be profitable in subsequent years.

Required:

6.Wai was born on 14 June 1960. She is employed as a sales manager by Qaz plc, and the following information is available in respect of the tax year 2014–15:
(1) During the tax year 2014–15, Wai was paid a gross monthly salary of £10,200. 
(2) In addition to her salary, Wai has been paid the following bonuses:

(3) During the period 6 April to 31 August 2014, Wai used her private motor car for both private and businessm journeys. She was reimbursed by Qaz plc at the rate of 55p per mile for the following mileage:

(4) During the period 1 September 2014 to 5 April 2015, Qaz plc provided Wai with a petrol powered motor car which has a list price of £15,800, and an official CO2 emission rate of 86 grams per kilometre. Qaz plc does not provide Wai with any fuel for private journeys.

(5) During January 2015, Wai spent ten nights overseas on company business. Qaz plc paid Wai a daily allowance of £10 to cover the cost of personal incidental expenses, such as telephone calls to her family. 

(6) Throughout the tax year 2014–15, Qaz plc allowed Wai the use of two mobile telephones. The telephones had each cost £400 when purchased by the company in March 2014.

(7) Throughout the tax year 2014–15, Qaz plc provided Wai with living accommodation. The company had purchased the property on 1 June 2011 for £142,000, and it has been provided to Wai since 1 February 2013.Improvements costing £14,400 were made to the property during October 2011, and further improvements costing £9,800 were made during August 2013. The annual value of the property is £4,600. 

Required: