P6高级税务-5及答案解析.doc

1、P6 高级税务-5 及答案解析(总分：100.00，做题时间：90 分钟)一、论述题(总题数：5，分数：100.00)1.You have recently been approached to act as an accountant for Styrax, aged 32, who is self-employed.The following information has been extracted from client files and from meetings with Styrax. You should assumethat todays date is 15 March

2、 2012.Styrax: Annual trading profits have been fairly constant at approximately 20,000 for the last few years. Has building society savings amounting to around 12,000 which generate gross annual interest ofapproximately 400. Wife, Salvia, is aged 28, is expecting their first child and has recently g

3、iven up employed work. The couple has no other sources of income. Disposable income is about 3,000 pa after paying their mortgage and living expenses.Investment strategy: Neither Styrax nor his wife have made, and for the present do not wish to start making, any pensionprovision. Risk averse.Stryaxs

4、 brother, Taxus: Single. Prepared to take medium to high risk in his investments. Already has a portfolio of investments and wishes to shelter some of his gains. Considering investing in the Enterprise Investment Scheme (EIS) and in Venture Capital Trusts (VCTs).Required(a) (i) Prepare notes for a m

5、eeting with Styrax setting out any measures that could be undertaken by thecouple in order to reduce their income tax and national insurance liabilities following Salvia leavingher employment.You should assume that Styrax does not wish to incorporate his business and that Salvia does notwish to join

6、 him in partnership.Detailed income tax computations are not required in this question part.(ii) Explain the options open to the couple regarding making future pension provision. You should assume that the tax rates and allowances for 2011/12 apply throughout.(b) Write a memorandum to Taxus setting

7、out the features of the EIS and VCTs. You should include details ofthe risk and taxation implications of each type of investment.（分数：20.00）_2.Coral is the owner and managing director of Reef Ltd. She is considering the manner in which she will make herfirst pension contributions. In November 2012 sh

8、e inherited her mothers house in the country of Kaiania, which isoutside the European Economic Area (EEA).The following information has been extracted from client files and from telephone conversations with Coral.Coral: 1975 - Born in the country of Kalania. Her father, who died in 2006, was domicil

9、ed in Kalania. 2004 - Moved to the UK and has lived and worked here since then. 2005 - Subscribed for 100% of the ordinary share capital of Reef Ltd. Intends to sell Reef Ltd and return to live in the country of Kalania in 2017. No income apart from that received from Reef Ltd.Reef Ltd: AUK resident

10、 company with annual taxable total profits of approximately 350,000. Fourteen employees including Coral. Provides scuba diving lessons to members of the public and specialist underwater photography facilities forcommercial organisations.Payments from Reef Ltd to Coral in 2012/13: Directors fees of 4

11、60 per month. Dividends paid of 16,250 in June 2012 and 16,250 in September 2012.Pension contributions: Coral has not so far made any pension contributions in the tax year 2012/13 but wishes to make grosspension contributions of 9,000. The contributions are to be made by Reef Ltd or Coral or a combi

12、nation of the two in such a way as tominimise the total after tax cost. Any contributions made by Coral will be funded by an additional dividend from Reef Ltd. Coral was not a member of a pension scheme in 2011/12 or any previous years.House in the country of Kalania: Beachfront property with potent

13、ial rental income of 550 per month after deduction of allowable expenditure. Coral will use it for holidays for two months each year.The tax system in the country of Kalania: No capital gains tax or inheritance tax. Income tax at 8% on income arising in the country of Kalania. No double tax treaty w

14、ith the UK.Required(a) With the objective of minimising the total after tax cost, advise Coral as to whether the gross pensioncontributions of 9,000 should be made: wholly by Reef Ltd; or by Coral to the extent that they are tax allowable with the balance made by Reef Ltd.Your answer should include

15、supporting calculations where necessary. (b) (i) Explain, by reference to Corals residence, ordinary residence and domicile position, how the rentalincome arising in respect of the property in the country of Kalania will be taxed in the UK in the taxyear 2012/13. State the strategy that Coral should

16、 adopt in order to minimise the total income taxsuffered on the rental income. (ii) Explain how the inclusion of rental income in Corals UK income tax computation could affect theincome tax due on her dividend income. You are not required to prepare calculations for part (b) of this question.Note: y

17、ou should assume that the tax rates and allowances for the tax year 2011/12 and for the Financial Year to 31March 2012 will continue to apply for the foreseeable future.（分数：20.00）_3.Your manager has had a meeting with Benny Fitt, the managing director of Usine Ltd, and has sent you a copy ofthe foll

18、owing memorandum.To The filesFrom Tax managerDate 20 December 2011Subject Usine Ltd(a) Provision of employment benefits to Benny Fitt (BF)Petrol company carProvided on 1 October 2011. Car has list price of 28,400 and CO 2 emission figure of 212g/kin. Sun-roofhas been added costing 700. BF made a cap

19、ital contribution of 2,500 towards the cost of the car.Company credit cardDuring 2011/12 this will be used to pay for: motor repairs 460 business accommodation 380 customer entertaining 720 petrol 425Included in the figure for petrol is 180 in respect of private mileage which is not reimbursed to Us

20、ine Ltd.Lap top computerCost 3,000. Provided on 6 April 2011, for private use and occasional business use.(b) Sales director changesOn 10 December 2011 Usine Ltd dismissed their sales director and paid him a lump sum redundancypayment of 45,000. This consisted of the following.Statutory redundancy p

21、ay 2,100Payment in lieu of notice 3,100Holiday pay 2,800Ex gratia compensation for loss of office 34,000Agreement not to work for a rival company 3,00045,000A new sales director is to commence employment on 1 January 2012. She is to be paid a lump sumpayment of 10,000 upon the commencement of employ

22、ment. The new director currently lives 120 milesfrom Usine Ltds head office, so the company has offered her two alternative arrangements.(i) Usine Ltd will pay 9,500 towards the cost of the directors relocation, and will also provide aninterest free loan of 50,000 in order for the director to purcha

23、se a property.(ii) Usine Ltd will provide accommodation for the director. The company owns a house which has anannual value of 4,400, is currently valued at 99,000, and has recently been furnished at a cost of10,400. Usine Ltd will pay for the annual running costs of 3,200.(c) Company Share Option P

24、lanThe company is considering setting up a Company Share Option Plan for certain senior employees anddirectors.Options will be granted to these individuals that will be exercisable between three and ten years after thegrant.An extract from an email from your manager is set out below.Please prepare a

25、 letter to Benny Fitt setting out the following:1 Employment benefitsAdvise both Benny Fitt and Usine Ltd of the tax implications arising from the provision of the company car,the credit card and the laptop computer.Explain why it would be beneficial if Benny paid Usine Ltd 180 for his private petro

26、l.You can ignore the VAT implications.Sales director changesExplain the income tax implications of the lump sum payments of 45,000 and 10,000.Explain the income tax implications of the two alternative arrangements offered to the new sales director.You do not need to consider the tax implications for

27、 Usine Ltd and you should confine your statements tothe implications for 2011/12.Share option schemeOutline the conditions required for the scheme to obtain HMRC approval.You have extracted the following further information from client files. Usine Ltd is an unquoted trading company. Benny Fitt is a

28、ged 39 and is paid a salary of 45,000 per annum. Usine Ltd purchased the house available to the new sales director in 1998 for 86,000. It was improved at acost of 8,000 during 2007.RequiredPrepare the letter requested by your manager.Marks are available for the components of the letter as follows:1

29、Tax treatment of the employment benefits for Benny Fitt and Usine Ltd. 2 Tax implications of the payments (and benefits) provided to the two sales directors. 3 The conditions for the share option scheme to be approved. Appropriateness of the format and presentation of the letter and the effectivenes

30、s with which its content iscommunicated. You may assume that the rates and allowances for the 2011/12 tax year and Financial Year 2011 continue to applyfor the foreseeable future.（分数：20.00）_4.Your manager has had a meeting with Pilar Mareno, a self-employed consultant, and has sent you a copy of the

31、following memorandum.To The filesFrom Tax managerDate 31 May 2012Subject Pilar Mareno-Business expansionPilar Mareno (PM) has been offered a contract with DWM plc, initially for two years, which will result in fees of80,000 plus VAT per annum.In order to service this contract, PM would have to take

32、on additional help in the form of either a part-time employeefor two days a week, or the services of a self-employed contractor for 100 days per year. She would also have toacquire a van, which would be used wholly for business purposes. PM has decided that she will only enter into thecontract if it

33、 generates at least an additional 15,000 per annum, on average, for the family after all costs and taxes.PMs annual profitability and the profit generated by the contract (before taking into account the costs of the part-time employee/contractor and the van) are summarised below.Existing Newbusiness

34、 contract Sales 210,000 80,000Less: Materials, wages and overheads (120,000) (35,000)Profit per accounts and taxable profit 90,000 45,000Supplies made under the contract will be 65% standard rated and 35% exempt for value added tax (VAT) purposes;this is the same as for PMs existing business. 31,500

35、 of the costs incurred in relation to the contract will besubject to VAT at the standard rate. The equivalent figure for PMs existing business is 100,000.PM has identified Max Wallen (MW) as a possible self-employed contractor. MW would charge 70 per day plusVAT for a contract of 100 days per year,

36、with a rate of 20 per day plus VAT in respect of any days when he is ill (upto a maximum of eight days per year). PM has a spare copy of the specialist software that MW would need but MWwould use his own laptop computer.Alternatively, PM could employ her husband, Alec (AM), paying him a gross annual

37、 salary of 7,600. AM wouldhave to give up his current full-time job, but would expect to do other part-time employed work earning a further10,000 (gross) per annum.PM estimates that a second hand van will cost 7,800 plus VAT or alternatively, a van could be leased for 300 plusVAT per month. We can a

38、ssume that if the van is purchased, it will be sold at the end of the two-year contract for2,500 plus VAT.Tax managerAn extract from an email from your manager is set out below.Please prepare a memorandum for me, incorporating the following:1 Calculations to demonstrate whether or not Pilars desired

39、 annual after tax income from the new contractwill be achievable depending on: whether she leases or buys the van; and whether she employs Alec or uses Max Wallen.You may find it easier to:(i) work out the after tax cost of buying or leasing the van. (When calculating the annual cost of the van,assu

40、me that the total cost can be averaged over the two years of the contract.)and then to consider:(ii) the after tax income depending on whether Alec is employed or the self-employed contractor, Max, isused.2 A rationale for the approach you have taken and a summary of your findings.3 Any other issues

41、 we should be considering in respect of Pilar employing Alec, including any alternative toemployment.4 It seems to me that HM Revenue and Customs may be able to successfully contend that Max Wallen wouldbe an employee, rather than a self-employed contractor. Prepare your figures on the basis that he

42、 is self-employed but include a list of factors in your memorandum, based on the information we have, that wouldindicate either employed or self-employed status.Take some time to think about your approach to this before you start. Also, as always when working on Pilarsaffairs, watch out for the VAT

43、as it can get quite tricky. I suspect the VAT will affect the costs incurred so youll needto address VAT first. Pilars estimate of the profit on the contract will have ignored these complications.Tax managerYou have extracted the following further information from Pilar Marenos client file. None of

44、Pilars VAT inputs is directly attributable to either standard rated or exempt supplies. Alec has worked for a UK bank for many years and is currently paid an annual salary of 17,000. The couple have no sources of income other than those set out above.RequiredPrepare the memorandum requested by your

45、manager.Marks are available for the four components of the memorandum as follows:(1) Relevant calculations. (2) Rationale for the approach taken and summary of findings. (3) Other issues in respect of Pilar employing Alec, together with any suggestions as to an alternative toemployment. (4) The empl

46、oyment status of Max Wallen. Appropriateness of the format and presentation of the memorandum and the effectiveness with which theinformation is communicated. You may assume that the rates and allowances for the tax year 2011/12 will continue to apply for the foreseeablefuture.（分数：20.00）_5.Faure exp

47、ects her new business to make a loss in its first trading period. She requires advice on the choice of yearend, on the difference between employing her husband in the business, and running the business as a partnership.The following information has been obtained from discussions with Faure.Faure:- I

48、s 44 years old and married to Ravel.- Has not had an income tax liability since the tax year 2003/04.- Intends to start a new business on 1 July 2012 under the trading name Bah-Tock.- Bah-Tock will be Faures only source of income.The Bah-Tock business:- Is expected to make a loss throughout the first 12 months of trading.- Is expected to be profitable from 1 July 2013 onwards.Structure of the Bah-Tock business:- The busin