(b) Provide the directors of Acrux Ltd with a detailed explanation of the maximum rate of tax that will be sufferedon both the distributed and non-distributed profits of the non-UK resident investee companies where:(1) there is a double tax treaty between
题目
(b) Provide the directors of Acrux Ltd with a detailed explanation of the maximum rate of tax that will be suffered
on both the distributed and non-distributed profits of the non-UK resident investee companies where:
(1) there is a double tax treaty between the UK and the country in which the individual companies are
resident; and
(2) there is no such double tax treaty.
Note: you are not required to explain the position of the overseas resident branches. (6 marks)
相似考题
更多“(b) Provide the directors of Acrux Ltd with a detailed explanation of the maximum rate of tax that will be sufferedon both the distributed and non-distributed profits of the non-UK resident investee companies where:(1) there is a double tax treaty between”相关问题
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第1题：
(ii) Briefly outline the tax consequences for Henry if the types of protection identified in (i) were to be
provided for him by Happy Home Ltd compared to providing them for himself. You are not required to
discuss the corporation tax (CT) consequences for Happy Home Ltd. (4 marks)
正确答案：
(ii) Provision of protection: company or individual
If any of the policies are taken out and paid for by Henry personally, then there will be no tax relief on the premiums,
but neither will there normally be any tax payable on the proceeds or benefits received.
If Happy Home Ltd were to pay the premiums on a policy taken out by Henry, and of which he was the direct beneficiary,
then this will constitute a benefit, on the grounds that the company will have satisfied a personal liability of Henry’s.
Accordingly, income tax and Class 1A national insurance contributions will be payable on the benefit.
If, however, Happy Home Ltd were to decide to offer protection benefits to their employees on a group basis (and not
just to Henry), then it would be possible to avoid a charge under the benefits rules and/or obtain a lower rate of premium
under a collective policy. For example:
– A death in service benefit of up to four times remuneration can be provided as part of an approved pension scheme.
No benefit charge arises on Henry and any lump sum will be paid tax free. This could be considered a substitute
for a term assurance policy.
– If a group permanent health insurance policy were taken out, no benefit charge would arise on Henry, but any
benefits payable under the policy would be paid to Happy Home Ltd in the first instance. When subsequently paid
on to Henry, such payments would be treated as arising from his employment and subject to PAYE and national
insurance as for normal salary payments.
– If a group critical illness policy were taken out, again no benefit charge would arise on Henry, but in this case also,
any benefits received by Henry directly from Happy Home Ltd as a result of the payments under the policy would
be considered as derived from his employment and subject to income tax and national insurance. Such a charge
to tax and national insurance would however be avoided if these payments were made in terms of a trust. -
第2题：
(d) Explain whether or not Dovedale Ltd, Hira Ltd and Atapo Inc can register as a group for the purposes of value
added tax. (3 marks)
正确答案：
(d) Dovedale Ltd and Hira Ltd can register as a group for the purposes of value added tax (VAT) because Dovedale Ltd controls
Hira Ltd and both companies are established in the UK in that their head offices are in the UK.
Dovedale Ltd will also control Atapo Inc. However, Atapo Inc cannot be part of a group registration unless it is established
in the UK or has a fixed establishment in the UK. It will be regarded as established in the UK if it is centrally managed and
controlled in the UK or if its head office is in the UK. A fixed establishment is a place where the company has staff and
equipment and where its business is carried on. -
第3题：
1 Alvaro Pelorus is 47 years old and married to Maria. The couple have two children, Vito and Sophie, aged 22 and
19 years respectively. Alvaro and Maria have lived in the country of Koruba since 1982. On 1 July 2005 the family
moved to the UK to be near Alvaro’s father, Ray, who was very ill. Alvaro and Maria are UK resident, but not ordinarily
resident in the tax years 2005/06 and 2006/07. They are both domiciled in the country of Koruba.
On 1 February 2007 Ray Pelorus died. He was UK domiciled, having lived in the UK for the whole of his life. For the
purposes of inheritance tax, his death estate consisted of UK assets, valued at ￡870,000 after deduction of all
available reliefs, and a house in the country of Pacifica valued at ￡94,000. The executors of Ray’s estate have paid
Pacifican inheritance tax of ￡1,800 and legal fees of ￡7,700 in respect of the sale of the Pacifican house. Ray left
the whole of his estate to Alvaro.
Ray had made two gifts during his lifetime:
(i) 1 May 2003: He gave Alvaro 95 acres of farm land situated in the UK. The market value of the land was
￡245,000, although its agricultural value was only ￡120,000. Ray had acquired the land on
1 January 1996 and granted an agricultural tenancy on that date. Alvaro continues to own the
land as at today’s date and it is still subject to the agricultural tenancy.
(ii) 1 August 2005: He gave Alvaro 6,000 shares valued at ￡183,000 in Pinger Ltd, a UK resident trading
company. Gift relief was claimed in respect of this gift. Ray had acquired 14,000 shares in
Pinger Ltd on 1 April 1997 for ￡54,600.
You may assume that Alvaro is a higher rate taxpayer for the tax years 2005/06 and 2006/07. In 2006/07 he made
the following disposals of assets:
(i) On 1 July 2006 he sold the 6,000 shares in Pinger Ltd for ￡228,000.
(ii) On 1 September 2006 he sold 2,350 shares in Lapis Inc, a company resident in Koruba, for ￡8,270. Alvaro
had purchased 5,500 shares in the company on 1 September 2002 for ￡25,950.
(iii) On 1 December 2006 he transferred shares with a market value of ￡74,000 in Quad plc, a UK quoted company,
to a UK resident discretionary trust for the benefit of Vito and Sophie. Alvaro had purchased these shares on
1 January 2006 for ￡59,500.
Alvaro has not made any other transfers of value for the purposes of UK inheritance tax. He owns the family house
in the UK as well as shares in UK and Koruban companies and commercial rental property in the country of Koruba.
Maria has not made any transfers of value for the purposes of UK inheritance tax. Her only significant asset is the
family home in the country of Koruba.
Alvaro and his family expect to return to their home in the country of Koruba in October 2007 once Ray’s affairs have
been settled. There is no double taxation agreement between the UK and Koruba.
Required:
(a) Calculate the inheritance tax (IHT) payable as a result of the death of Ray Pelorus. Explain the availability
or otherwise of agricultural property relief and business property relief on the two lifetime gifts made by Ray.
(8 marks)
正确答案：
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第4题：
(b) Draft a report as at today’s date advising Cutlass Inc on its proposed activities. The report should cover the
following issues:
(i) The rate at which the profits of Cutlass Inc will be taxed. This section of the report should explain:
– the company’s residency position and what Ben and Amy would have to do in order for the company
to be regarded as resident in the UK under the double tax treaty;
– the meaning of the term ‘permanent establishment’ and the implications of Cutlass Inc having a
permanent establishment in Sharpenia;
– the rate at which the profits of Cutlass Inc will be taxed on the assumption that it is resident in the
UK under the double tax treaty and either does or does not have a permanent establishment in
Sharpenia. (9 marks)
正确答案：
(b) Report to the management of Razor Ltd
To The management of Razor Ltd
From Tax advisers
Date 6 June 2007
Subject The proposed activities of Cutlass Inc
(i) Rate of tax on profits of Cutlass Inc
When considering the manner in which the profits of Cutlass Inc will be taxed it must be recognised that the system of
corporation tax in Sharpenia is the same as that in the UK.
The profits of Cutlass Inc will be subject to corporation tax in the country in which it is resident or where it has a
permanent establishment. It is desirable for the profits of Cutlass Inc to be taxed in the UK rather than in Sharpenia as
the rate of corporation tax in the UK on annual profits of ￡120,000 will be 19% whereas in Sharpenia the rate of tax
would be 38%.
Residency of Cutlass Inc
Cutlass Inc will be resident in Sharpenia, because it is incorporated there. However, it will also be resident in the UK if
it is centrally managed and controlled from the UK. For this to be the case, Amy and Ben should hold the company’s
board meetings in the UK.
Under the double tax treaty between the UK and Sharpenia, a company resident in both countries is treated as being
resident in the country where it is effectively managed and controlled. For Cutlass Inc to be treated as UK resident under
the treaty, Amy and Ben would need to ensure that all key management and commercial decisions are made in the UK
and not in Sharpenia.
Permanent establishment
A permanent establishment is a fixed place of business, including an office, factory or workshop, through which the
business of an enterprise is carried on. A permanent establishment will also exist in a country if contracts in the
company’s name are habitually concluded there.
The trading profits of Cutlass Inc will be taxable in Sharpenia if they are derived from a permanent establishment in
Sharpenia even if it can be established that Cutlass Inc is UK resident under the double tax treaty.
Double taxation
If Cutlass Inc is UK resident but has a permanent establishment in Sharpenia, its trading profits will be subject to
corporation tax in both the UK and Sharpenia with double tax relief available in the UK. The double tax relief will be the
lower of the UK tax and the Sharpenian tax on the trading profits. Accordingly, as the rate of tax is higher in Sharpenia
than it is in the UK, there will be no UK tax to pay on the company’s trading profits and the rate of tax on the profits
would be the rate in Sharpenia, i.e. 38%.
If Cutlass Inc is UK resident and does not have a permanent establishment in Sharpenia, its profits will be taxable in
the UK at the rate of 19% and not in Sharpenia. -
第5题：
(b) The directors of Carver Ltd are aware that some of the company’s shareholders want to realise the value in their
shares immediately. Accordingly, instead of investing in the office building or the share portfolio they are
considering two alternative strategies whereby, following the sale of the company’s business, a payment will be
made to the company’s shareholders.
(i) Liquidate the company. The payment by the liquidator would be ￡126 per share.
(ii) The payment of a dividend of ￡125 per share following which a liquidator will be appointed. The payment
by the liquidator to the shareholders would then be ￡1 per share.
The company originally issued 20,000 ￡1 ordinary shares at par value to 19 members of the Cutler family.
Following a number of gifts and inheritances there are now 41 shareholders, all of whom are family members.
The directors have asked you to attend a meeting to set out the tax implications of these two alternative strategies
for each of the two main groups of shareholders: adults with shareholdings of more than 500 shares and children
with shareholdings of 200 shares or less.
Required:
Prepare notes explaining:
– the amount chargeable to tax; and
– the rates of tax that will apply
in respect of each of the two strategies for each of the two groups of shareholders ready for your meeting
with the directors of Carver Ltd. You should assume that none of the shareholders will have any capital
losses either in the tax year 2007/08 or brought forward as at 5 April 2007. (10 marks)
Note:
You should assume that the rates and allowances for the tax year 2006/07 will continue to apply for the
foreseeable future.
正确答案：
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第6题：
4 Coral is the owner and managing director of Reef Ltd. She is considering the manner in which she will make her first
pension contributions. In November 2007 she inherited her mother’s house in the country of Kalania.
The following information has been extracted from client files and from telephone conversations with Coral.
Coral:
– 1972 – Born in the country of Kalania. Her father, who died in 2002, was domiciled in Kalania.
– 1999 – Moved to the UK and has lived and worked here since then.
– 2001 – 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 2012.
– No income apart from that received from Reef Ltd.
Reef Ltd:
– A UK resident company with annual profits chargeable to corporation tax of approximately ￡70,000.
– Four employees including Coral.
– Provides scuba diving lessons to members of the public.
Payments from Reef Ltd to Coral in 2007/08:
– Director’s fees of ￡460 per month.
– Dividends paid of ￡14,250 in June 2007 and ￡14,250 in September 2007.
Pension contributions:
– Coral has not so far made any pension contributions in the tax year 2007/08 but wishes to make gross pension
contributions of ￡9,000.
– The contributions are to be made by Reef Ltd or Coral or a combination of the two in such a way as to minimise
the total after tax cost.
– Any contributions made by Coral will be funded by an additional dividend from Reef Ltd.
House in the country of Kalania:
– Beachfront property with potential 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 with the UK.
Required:
(a) With the objective of minimising the total after tax cost, advise Coral as to whether the gross pension
contributions 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 supporting calculations where necessary. (9 marks)
正确答案：
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第7题：
3 Spica, one of the director shareholders of Acrux Ltd, has been in dispute with the other shareholders over plans to
expand the company’s activities overseas. In order to resolve the position it has been agreed that Spica will sell her
shares back to the company. Once the purchase of her shares has taken place, the company intends to establish a
number of branches overseas and acquire a shareholding in a number of companies that are resident and trade in
overseas countries.
The following information has been obtained from client files and meetings with the parties involved.
Acrux Ltd:
– An unquoted UK resident company.
– Share capital consists of 50,000 ordinary shares issued at ￡1·90 per share in July 2000.
– None of the other shareholders has any connection with Spica.
The purchase of own shares:
– The company will purchase all of Spica’s shares for ￡8 per share.
– The transaction will take place by the end of 2008.
Spica:
– Purchased 8,000 shares in Acrux Ltd for ￡2 per share on 30 September 2003.
– Has no income in the tax year 2008/09.
– Has chargeable capital gains in the tax year 2008/09 of ￡3,800.
– Has houses in the UK and the country of Solaris and divides her time between them.
Investment in non-UK resident companies:
– Acrux Ltd will acquire between 15% and 20% of each of the non-UK resident companies.
– The companies will not be controlled foreign companies as the rates of tax in the overseas countries will be
between 23% and 42%.
– There may or may not be a double tax treaty between the UK and the overseas countries in which the companies
are resident. Where there is a treaty, it will be based on the OECD model treaty.
– None of the countries concerned levy withholding tax on dividends paid to UK companies.
– The directors of Acrux Ltd are concerned that the rate of tax suffered on the profits of the overseas companies
will be very high as they will be taxed in both the overseas country and in the UK.
Required:
(a) (i) Prepare detailed calculations to determine the most beneficial tax treatment of the payment Spica will
receive for her shares; (7 marks)
正确答案：
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第8题：
(ii) State, with reasons, whether Messier Ltd can provide Galileo with accommodation in the UK without
giving rise to a UK income tax liability. (2 marks)
正确答案：
(ii) Tax-free accommodation
It is not possible for Messier Ltd to provide Galileo with tax-free accommodation. The provision of accommodation by an
employer to an employee will give rise to a taxable benefit unless it is:
– necessary for the proper performance of the employee’s duties, e.g. a caretaker; or
– for the better performance of the employee’s duties and customary, e.g. a hotel manager; or
– part of arrangements arising out of threats to the employee’s security, e.g. a government minister.
As a manager of Messier Ltd Galileo is unable to satisfy any of the above conditions. -
第9题：
3 The Stiletto Partnership consisted of three partners, Clint, Ben and Amy, who shared the profits of the business
equally. On 28 February 2007 the partners sold the business to Razor Ltd, in exchange for shares in Razor Ltd, with
each former partner owning one third of the new company.
The recent, tax adjusted, trading profits of the Stiletto Partnership have been as follows:
￡
Year ended 30 June 2006 92,124
1 July 2006 to 28 February 2007 81,795
Clint, who was 65 on 5 October 2006, retired when the business was sold to Razor Ltd. He is now suggesting that
if the sale of the partnership, and his retirement, had been delayed until 30 April 2007, his total tax liability would
have been reduced. Clint’s only other income is gross pension income of ￡6,100 per year, which he began receiving
in the tax year 2005/06. Clint did not receive any salary or dividends from Razor Ltd. It is estimated that the
partnership’s tax adjusted trading profits for the period from 1 March 2007 to 30 April 2007 would have been
￡20,760. Clint has overlap profits of ￡14,250 brought forward from when the partnership began trading.
Razor Ltd manufactures industrial cutting tools. On 1 July 2007, Razor Ltd will subscribe for the whole of the ordinary
share capital of Cutlass Inc, a company newly incorporated in the country of Sharpenia. It is intended that Cutlass
Inc will purchase partly finished tools from Razor Ltd and customise them in Sharpenia. It is anticipated that Cutlass
Inc’s annual profits chargeable to corporation tax will be approximately ￡120,000.
Ben and Amy will be the directors of Cutlass Inc, although Ben will not be involved in the company’s business on a
day-to-day basis. Amy intends to spend one or two weeks each month in the country of Sharpenia looking after the
company’s affairs. The remainder of her time will be spent in the UK. Amy has employment contracts with both Razor
Ltd and Cutlass Inc and her duties for Cutlass Inc will be carried out wholly in Sharpenia. Cutlass Inc will pay for
Amy’s flights to and from Sharpenia and for her husband and baby to visit her there twice a year. Amy is currently
UK resident and ordinarily resident.
The system of income tax and corporation tax in the country of Sharpenia is broadly similar to that in the UK although
the rate of corporation tax is 38% regardless of the level of profits. There is a double tax treaty between the UK and
Sharpenia based on the OECD model treaty. The clause in the treaty dealing with company residency states that a
company resident in both countries under domestic law will be regarded under the treaty as being resident only in the
country where it is effectively managed and controlled. Sharpenia is not a member of the European Union.
Required:
(a) (i) Calculate Clint’s taxable trading profits for the tax years 2006/07 and 2007/08 for both of the
alternative retirement dates (28 February 2007 and 30 April 2007). (3 marks)
正确答案：
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第10题：
The new service helped boost pre-tax profits by 10%.A:return
B:realize
C:increase
D:double答案：C解析：本句意思：这项新服务使税前利润提升了10%。boost意思是“使增长，使兴旺”，与increase（增加，提升）意思相近。return回来，回转；realize实现，察觉；double（使）加倍，（使）双倍。 -
第11题：
Which of the following aspects is not what an economic union concerns？（）
- A、common currency
- B、harmonized tax rates
- C、harmonized tax rate structures
- D、common political policy
正确答案:D -
第12题：
单选题According to the passage, the income gap between rich and poor could widen again as ______.Athe unemployment rate is lowered
Bthe increase of benefits is independent of price increase
Cthe income tax rate is increasing
Dthe increase of benefits is only based on prices
正确答案： A解析：
题目问的是：根据文章，富人和穷人间的收入差距可能会因为什么再次扩大？文章第2段提到“Some long-term sick...grow relatively poorer if... raise benefits only in line with prices.”，以及第5段提到“it could widen again if the real value of earnings accelerated away from the real value of prices-linked benefits”，表明了如果福利只与价格挂钩，不顾人们收入的真正价值，贫富差距很可能会拉大。故D正确。 -
第13题：
3 On 1 January 2007 Dovedale Ltd, a company with no subsidiaries, intends to purchase 65% of the ordinary share
capital of Hira Ltd from Belgrove Ltd. Belgrove Ltd currently owns 100% of the share capital of Hira Ltd and has no
other subsidiaries. All three companies have their head offices in the UK and are UK resident.
Hira Ltd had trading losses brought forward, as at 1 April 2006, of ￡18,600 and no income or gains against which
to offset losses in the year ended 31 March 2006. In the year ending 31 March 2007 the company expects to make
further tax adjusted trading losses of ￡55,000 before deduction of capital allowances, and to have no other income
or gains. The tax written down value of Hira Ltd’s plant and machinery as at 31 March 2006 was ￡96,000 and
there will be no fixed asset additions or disposals in the year ending 31 March 2007. In the year ending 31 March
2008 a small tax adjusted trading loss is anticipated. Hira Ltd will surrender the maximum possible trading losses
to Belgrove Ltd and Dovedale Ltd.
The tax adjusted trading profit of Dovedale Ltd for the year ending 31 March 2007 is expected to be ￡875,000 and
to continue at this level in the future. The profits chargeable to corporation tax of Belgrove Ltd are expected to be
￡38,000 for the year ending 31 March 2007 and to increase in the future.
On 1 February 2007 Dovedale Ltd will sell a small office building to Hira Ltd for its market value of ￡234,000.
Dovedale Ltd purchased the building in March 2005 for ￡210,000. In October 2004 Dovedale Ltd sold a factory
for ￡277,450 making a capital gain of ￡84,217. A claim was made to roll over the gain on the sale of the factory
against the acquisition cost of the office building.
On 1 April 2007 Dovedale Ltd intends to acquire the whole of the ordinary share capital of Atapo Inc, an unquoted
company resident in the country of Morovia. Atapo Inc sells components to Dovedale Ltd as well as to other
companies in Morovia and around the world.
It is estimated that Atapo Inc will make a profit before tax of ￡160,000 in the year ending 31 March 2008 and will
pay a dividend to Dovedale Ltd of ￡105,000. It can be assumed that Atapo Inc’s taxable profits are equal to its profit
before tax. The rate of corporation tax in Morovia is 9%. There is a withholding tax of 3% on dividends paid to
non-Morovian resident shareholders. There is no double tax agreement between the UK and Morovia.
Required:
(a) Advise Belgrove Ltd of any capital gains that may arise as a result of the sale of the shares in Hira Ltd. You
are not required to calculate any capital gains in this part of the question. (4 marks)
正确答案：
(a) Capital gains that may arise on the sale by Belgrove Ltd of shares in Hira Ltd
Belgrove Ltd will realise a capital gain on the sale of the shares unless the substantial shareholding exemption applies. The
exemption will be given automatically provided all of the following conditions are satisfied.
– Belgrove Ltd has owned at least 10% of Hira Ltd for a minimum of 12 months during the two years prior to the sale.
– Belgrove Ltd is a trading company or a member of a trading group during that 12-month period and immediately after
the sale.
– Hira Ltd is a trading company or the holding company of a trading group during that 12-month period and immediately
after the sale.
Hira Ltd will no longer be in a capital gains group with Belgrove Ltd after the sale. Accordingly, a capital gain, known as a
degrouping charge, may arise in Hira Ltd. A degrouping charge will arise if, at the time it leaves the Belgrove Ltd group, Hira
Ltd owns any capital assets which were transferred to it at no gain, no loss within the previous six years by a member of the
Belgrove Ltd capital gains group. -
第14题：
(ii) Compute the annual income tax saving from your recommendation in (i) above as compared with the
situation where Cindy retains both the property and the shares. Identify any other tax implications
arising from your recommendation. Your answer should consider all relevant taxes. (3 marks)
正确答案：
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第15题：
(ii) Analyse the effect of delaying the sale of the business of the Stiletto Partnership to Razor Ltd until
30 April 2007 on Clint’s income tax and national insurance position.
You are not required to prepare detailed calculations of his income tax or national insurance liabilities.
(4 marks)
正确答案：(ii) The implications of delaying the sale of the business
The implications of delaying the sale of the business until 30 April would have been as follows:
– Clint would have received an additional two months of profits amounting to ￡6,920 (￡20,760 x 1/3).
– Clint’s trading income in 2006/07 would have been reduced by ￡13,015 (￡43,723 – ￡30,708), much of which
would have been subject to income tax at 40%. His additional trading income in 2007/08 of ￡19,935 would all
have been taxed at 10% and 22%.
– Clint is entitled to the personal age allowance of ￡7,280 in both years. However, it is abated by ￡1 for every ￡2
by which his total income exceeds ￡20,100. Once Clint’s total income exceeds ￡24,590 (￡20,100 + ((￡7,280
– ￡5,035) x 2)), his personal allowance will be reduced to the standard amount of ￡5,035. Accordingly, the
increased personal allowance would not be available in 2006/07 regardless of the year in which the business was
sold. It is available in 2007/08 (although part of it is wasted) but would not have been if the sale of the business
had been delayed.
– Clint’s class 4 national insurance contributions in 2006/07 would have been reduced due to the fall in the level
of his trading income. However, much of the saving would be at 1% only. Clint is not liable to class 4 national
insurance contributions in 2007/08 as he is 65 at the start of the year.
– Changing the date on which the business was sold would have had no effect on Clint’s class 2 liability as he is
not required to make class 2 contributions once he is 65 years old.
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第16题：
(b) Explain the corporation tax and value added tax (VAT) implications of the following aspects of the proposed
restructuring of the Rapier Ltd group.
(i) The immediate tax implications of the restructuring. (6 marks)
正确答案：
(b) The tax implications of the proposed restructuring of the Rapier Ltd group
(i) Immediate implications
Corporation tax
Rapier Ltd and its subsidiaries are in a capital gains group as Rapier Ltd owns at least 75% of the ordinary share capital
of each of the subsidiary companies. Any non-exempt items of plant and machinery owned by the subsidiaries will
therefore be transferred to Rapier Ltd at no gain, no loss.
No taxable credit or allowable debit will arise on the transfer of the subsidiaries’ goodwill to Rapier Ltd because the
companies are in a capital gains group.
The trading losses brought forward in Dirk Ltd will be transferred with the trade to Rapier Ltd as the effective ownership
of the three trades will not change (Rapier Ltd owns the subsidiaries which own the trades and, following the
restructuring, will own the three trades directly). The losses will be restricted to being offset against the future trading
profits of the Dirk trade only.
There will be no balancing adjustments in respect of the plant and machinery transferred to Rapier Ltd. Writing down
allowances will be claimed by the subsidiaries in respect of the year ending 30 June 2007 and by Rapier Ltd in respect
of future periods.
Value added tax (VAT)
No VAT should be charged on the sales of the businesses to Rapier Ltd as they are outside the scope of VAT. This is
because the trades are to be transferred as going concerns to a VAT registered person with no significant break in trading.
Switch Ltd must notify HM Revenue and Customs by 30 July 2007 that it has ceased to make taxable supplies. -
第17题：
3 Palm plc recently acquired 100% of the ordinary share capital of Nikau Ltd from Facet Ltd. Palm plc intends to use
Nikau Ltd to develop a new product range, under the name ‘Project Sabal’. Nikau Ltd owns shares in a non-UK
resident company, Date Inc.
The following information has been extracted from client files and from a meeting with the Finance Director of Palm
plc.
Palm plc:
– Has more than 40 wholly owned subsidiaries such that all group companies pay corporation tax at 30%.
– All group companies prepare accounts to 31 March.
– Acquired Nikau Ltd on 1 November 2007 from Facet Ltd, an unrelated company.
Nikau Ltd:
– UK resident company that manufactures domestic electronic appliances for sale in the European Union (EU).
– Large enterprise for the purposes of the enhanced relief available for research and development expenditure.
– Trading losses brought forward as at 1 April 2007 of ￡195,700.
– Budgeted taxable trading profit of ￡360,000 for the year ending 31 March 2008 before taking account of ‘Project
Sabal’.
– Dividend income of ￡38,200 will be received in the year ending 31 March 2008 in respect of the shares in Date
Inc.
‘Project Sabal’:
– Development of a range of electronic appliances, for sale in North America.
– Project Sabal will represent a significant advance in the technology of domestic appliances.
– Nikau Ltd will spend ￡70,000 on staffing costs and consumables researching and developing the necessary
technology between now and 31 March 2008. Further costs will be incurred in the following year.
– Sales to North America will commence in 2009 and are expected to generate significant profits from that year.
Shares in Date Inc:
– Nikau Ltd owns 35% of the ordinary share capital of Date Inc.
– The shares were purchased from Facet Ltd on 1 June 2003 for their market value of ￡338,000.
– The sale was a no gain, no loss transfer for the purposes of corporation tax.
– Facet Ltd purchased the shares in Date Inc on 1 March 1994 for ￡137,000.
Date Inc:
– A controlled foreign company resident in the country of Palladia.
– Annual chargeable profits arising out of property investment activities are approximately ￡120,000, of which
approximately ￡115,000 is distributed to its shareholders each year.
The tax system in Palladia:
– No taxes on income or capital profits.
– 4% withholding tax on dividends paid to shareholders resident outside Palladia.
Required:
(a) Prepare detailed explanatory notes, including relevant supporting calculations, on the effect of the following
issues on the amount of corporation tax payable by Nikau Ltd for the year ending 31 March 2008.
(i) The costs of developing ‘Project Sabal’ and the significant commercial changes to the company’s
activities arising out of its implementation. (8 marks)
正确答案：
(a) Nikau Ltd – Effect on corporation tax payable for the year ending 31 March 2008
(i) Project Sabal
Research and development expenditure
The expenditure incurred in respect of research and development will give rise to an enhanced deduction for the
purposes of computing the taxable trading profits of Nikau Ltd. The enhanced deduction is 125% of the qualifying
expenditure as Nikau Ltd is a large enterprise for this purpose.
The expenditure will reduce the profits chargeable to corporation tax of Nikau Ltd by ￡87,500 (￡70,000 x 1·25) and
its corporation tax liability by ￡26,250 (￡87,500 x 30%).
The budgeted expenditure will qualify for the enhanced deduction because it appears to satisfy the following conditions.
– It is likely to qualify as research and development expenditure within generally accepted accounting principles as
it will result in new technical knowledge and the production of a substantially improved device for use in the
industry.
– It exceeds ￡10,000 in Nikau Ltd’s accounting period.
– It relates to staff costs, consumable items or other qualifying expenditure as opposed to capital items.
– It will result in further trading activities for Nikau Ltd.
Use of brought forward trading losses
The development of products for the North American market is likely to represent a major change in the nature and
conduct of the trade of Nikau Ltd. This is because the company is developing new products and intends to sell them in
a new market. It is a major change as sales to North America are expected to generate significant additional profits.
Because this change will occur within three years of the change in the ownership of Nikau Ltd on 1 November 2007,
any trading losses arising prior to that date cannot be carried forward beyond that date.
Accordingly, the trading losses brought forward may only be offset against ￡158,958 ((￡360,000 – ￡87,500) x 7/12)
of the company’s trading profits for the year. The remainder of the trading losses ￡36,742 (￡195,700 – ￡158,958) will
be lost resulting in lost tax relief of ￡11,023 (￡36,742 x 30%).
Tutorial note
The profits for the year ending 31 March 2008 will be apportioned to the periods pre and post 1 November 2007 on
either a time basis or some other basis that is just and reasonable. -
第18题：
(b) (i) Explain, by reference to Coral’s residence, ordinary residence and domicile position, how the rental
income arising in respect of the property in the country of Kalania will be taxed in the UK in the tax year
2007/08. State the strategy that Coral should adopt in order to minimise the total income tax suffered
on the rental income. (7 marks)
正确答案：
(b) (i) UK tax on the rental income
Coral is UK resident in 2007/08 because she is present in the UK for more than 182 days. Accordingly, she will be
subject to UK income tax on her Kalanian rental income.
Coral is ordinarily resident in the UK in 2007/08 as she is habitually resident in the UK.
Coral will have acquired a domicile of origin in Kalania from her father. She has not acquired a domicile of choice in the
UK as she has not severed her ties with Kalania and does not intend to make her permanent home in the UK.
Accordingly, the rental income will be taxed in the UK on the remittance basis.
Any rental income remitted to the UK will fall into the basic rate band and will be subject to income tax at 22% on the
gross amount (before deduction of Kalanian tax). Unilateral double tax relief will be available in respect of the 8% tax
suffered in Kalania such that the effective rate of tax suffered by Coral in the UK on the grossed up amount of income
remitted will be 14%.
In order to minimise the total income tax suffered on the rental income Coral should ensure that it is not brought into or
used in the UK such that it will not be subject to income tax in the UK.
Coral should retain evidence, for example bank statements, to show that the rental income has not been removed from
Kalania. Coral can use the money whilst she is on holiday in Kalania with no UK tax implications. -
第19题：
(c) (i) Explain how Messier Ltd can assist Galileo with the cost of relocating to the UK and/or provide him with
interest-free loan finance for this purpose without increasing his UK income tax liability; (3 marks)
正确答案：
(c) (i) Relocation costs
Direct assistance
Messier Ltd can bear the cost of certain qualifying relocation costs of Galileo up to a maximum of ￡8,000 without
increasing his UK income tax liability. Qualifying costs include the legal, professional and other fees in relation to the
purchase of a house, the costs of travelling to the UK and the cost of transporting his belongings. The costs must be
incurred before the end of the tax year following the year of the relocation, i.e. by 5 April 2010.
Assistance in the form. of a loan
Messier Ltd can provide Galileo with an interest-free loan of up to ￡5,000 without giving rise to any UK income tax. -
第20题：
5 Gagarin wishes to persuade a number of wealthy individuals who are business contacts to invest in his company,
Vostok Ltd. He also requires advice on the recoverability of input tax relating to the purchase of new premises.
The following information has been obtained from a meeting with Gagarin.
Vostok Ltd:
– An unquoted UK resident company.
– Gagarin owns 100% of the company’s ordinary share capital.
– Has 18 employees.
– Provides computer based services to commercial companies.
– Requires additional funds to finance its expansion.
Funds required by Vostok Ltd:
– Vostok Ltd needs to raise ￡420,000.
– Vostok Ltd will issue 20,000 shares at ￡21 per share on 31 August 2008.
– The new shareholder(s) will own 40% of the company.
– Part of the money raised will contribute towards the purchase of new premises for use by Vostok Ltd.
Gagarin’s initial thoughts:
– The minimum investment will be 5,000 shares and payment will be made in full on subscription.
– Gagarin has a number of wealthy business contacts who may be interested in investing.
– Gagarin has heard that it may be possible to obtain tax relief for up to 60% of the investment via the enterprise
investment scheme.
Wealthy business contacts:
– Are all UK resident higher rate taxpayers.
– May wish to borrow the funds to invest in Vostok Ltd if there is a tax incentive to do so.
New premises:
– Will cost ￡446,500 including value added tax (VAT).
– Will be used in connection with all aspects of Vostok Ltd’s business.
– Will be sold for ￡600,000 plus VAT in six years time.
– Vostok Ltd will waive the VAT exemption on the sale of the building.
The VAT position of Vostok Ltd:
– In the year ending 31 March 2009, 28% of Vostok Ltd’s supplies will be exempt for the purposes of VAT.
– This percentage is expected to reduce over the next few years.
– Irrecoverable input tax due to the company’s partially exempt status exceeds the de minimis limits.
Required:
(a) Prepare notes for Gagarin to use when speaking to potential investors. The notes should include:
(i) The tax incentives immediately available in respect of the amount invested in shares issued in
accordance with the enterprise investment scheme; (5 marks)
正确答案：
(a) (i) The tax incentives immediately available
Income tax
– The investor’s income tax liability for 2008/09 will be reduced by 20% of the amount subscribed for the shares.
– Up to half of the amount invested can be treated as if paid in 2007/08 rather than 2008/09. This is subject to a
maximum carryback of ￡50,000.
This ability to carryback relief to the previous year is useful where the investor’s income in 2008/09 is insufficient
to absorb all of the relief available.
Tutorial note
There would be no change to the income tax liability of 2007/08 where an amount is treated as if paid in that year.
This ensures that such a claim does not affect payments on account under the self assessment system. Instead, the
tax refund due is calculated by reference to 2007/08 but is deducted from the next payment of tax due from the
taxpayer or is repaid to the taxpayer.
Capital gains tax deferral
– For every ￡1 invested in Vostok Ltd, an investor can defer ￡1 of capital gain and thus, potentially, 40 pence of
capital gains tax.
– The gain deferred can be in respect of the disposal of any asset.
– The shares must be subscribed for within the four year period starting one year prior to the date on which the
disposal giving rise to the gain took place. -
第21题：
有如下程序: includeusing namespace std; class Wages{／／“工资”类 double base; ／／ 有如下程序：
include＜iostream＞
using namespace std；
class Wages{ //“工资”类
double base； //基本工资
double bonus； //奖金
double tax； //税金
public：
Wages(double CBase，double CBonus，double CTax)：
base(CBase)，bonus(CBonus)，tax(CTax){}
double getPay()const； //返回应付工资额
Wages operator+(Wages w)const； //重载加法
}；
double Wages::getPay()const{return base+bonus-tax;}
Wages Wages::operator+(Wages W)const{
return Wages(base+w.base，bonus+w.bonus，tax+w.tax)；
}
int main(){
Wages w1(2000,500,100),w2(5000,1000,300)；
cout＜＜(w1+w2).getPay0＜＜end1；
return 0；
}
程序的输出结果是
正确答案：8100
8100 解析：此题考查运算符重载。首先从主函数入手，定义了类 Wages的对象w1和w2，然后调用重载运算符+，计算对象w1和w2中CBase、CBonus以及CTax的和，分别是7000、1500、400，然后调用getPay()成员函数，计算base+bonus-tax，7000+1500-400=8100。 -
第22题：
The new service helped boost pre-tax profits by 10%.A:return
B:realize
C:increase
D:double答案：C解析：本句意思：这项新服务把税前利润提升了10%。 boost使增长，使兴旺。return带来，产生（利润或损失）;realize实现，察觉；increase（使）增加，增长，增多；double（使）加倍，是……的两倍。 -
第23题：
Examine the structures of the EMPLOYEES and TAX tables. EMPLOYEES EMPLOYEE_ID NUMBER NOT NULL, Primary Key EMP_NAME VARCHAR2 (30) JOB_ID VARCHAR2 (20) SALARY NUMBER References MGR_ID NUMBER EMPLOYEE_ID column DEPARTMENT_ID NUMBER Foreign key to DEPARTMENT _ID column of the DEPARTMENT table TAX MIN_SALARY NUMBER MAX_SALARY NUMBER TAX_PERCENT NUMBER Percentage tax for given salary range You need to find the percentage tax applicable for each employee. Which SQL statement would you use?（）
- A、SELECT employee_id, salary, tax_percent FROM employees e, tax t WHERE e.salary BETWEEN t.min _ salary AND t.max_salary
- B、SELECT employee_id, salary, tax_percent FROM employees e, tax t WHERE e.salary > t.min_salary, tax_percent
- C、SELECT employee_id, salary, tax_percent FROM employees e, tax t WHERE MIN(e.salary) = t.min_salary AND MAX(e.salary) = t.max_salary
- D、You cannot find the information because there is no common column between the two tables.
正确答案:A