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问答题Crusoe has contacted you following the death of his father, Noland. Crusoe has inherited the whole of his father's estate and is seeking advice on his father's capital gains tax position and the payment of inheritance tax following his death. The following information has been extracted from client files and from telephone conversations with Crusoe. Noland - personal information: · Divorcee whose only other relatives are his sister, Avril, and two grandchildren. · Died suddenly on 1 October 2012 without having made a will. · Under the laws of intestacy, the whole of his estate passes to Crusoe. Noland - income tax and capital gains tax: · Sales of quoted shares resulted in: · Chargeable gains of ￡7,100 and allowable losses of ￡16,800 in the tax year 2012/13. · Chargeable gains of approximately ￡14,000 each tax year from 2005/06 to 2011/12. · Noland had taxable income of between ￡15,000 and ￡20,000 each tax year. Noland - gifts made during lifetime: · On 1 December 2004 Noland gave his house to Crusoe. · Crusoe has allowed Noland to continue living in the house and has charged him rent of ￡120 per month since 1 December 2004. The market rent for the house would be ￡740 per month. · The house was worth ￡240,000 at the time of the gift and ￡310,000 on 1 October 2012. · On 1 November 2008 Noland transferred quoted shares worth ￡326,000 to a discretionary trust for the benefit of his grandchildren. Noland - probate values of assets held at death: ￡ Portfolio of quoted shares 370,000 Shares in Kurb Ltd 38,400 Chattels and cash 22,300 Domestic liabilities including income tax payable (1,506) · It should be assumed that these values will not change for the foreseeable future. Kurb Ltd: · Unquoted trading company · Noland purchased the shares on 1 December 2010. Crusoe: · Long-standing personal tax client of your firm. · Married with two young children. · Successful investment banker with very high net worth. · Has taxable income in excess of ￡150,000 per tax year · Intends to gift the portfolio of quoted shares inherited from Noland to his aunt, Avril, who has very little personal wealth. Required (a) Prepare explanatory notes together with relevant supporting calculations in order to quantify the tax relief potentially available in respect of Noland's capital losses realised in 2012/13. (b) State the immediate tax implications of the proposed gift of the share portfolio to Avril and identify an alternative strategy that would achieve Crusoe's objectives whilst avoiding a possible tax liability in the future. State any deadline(s) in connection with your proposed strategy. (c) On the assumption that the administrators of Noland's estate will sell quoted shares in order to fund the inheritance tax due as a result of his death, calculate the value of the quoted shares that will be available to transfer to Avril. You should include brief notes of your treatment of the house and the shares in Kurb Ltd. Note: you should assume that the tax rates and allowances for the tax year 2011/12 apply throughout this question apart from the nil rate band for inheritance tax in 2008/09.
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问答题Simone is a partner in the firm Ellington and Co. She is seeking advice on the tax efficient use of her share of the partnership's loss for the year ended 5 April 2012. Simone intends to establish a new business and is considering the need to register for the purposes of value added tax (VAT). The following information has been obtained from a meeting with Simone. Simone's income and capital gains: - Dividends received of ￡12,600 in the tax year 2010/11, ￡10,800 in the tax year 2011/12 and ￡nil in subsequent years. In years prior to this, she had received dividends of ￡9,000 per annum. - Share of profits from Ellington and Co for the year ended 5 April 2011 of ￡48,200. - Capital gains of ￡94,000 on the sale of a portfolio of quoted shares on 1 February 2012. Ellington and Co: - Has been trading for many years. - Has two partners; Ellington and Simone. A third partner, Basle, retired on 28 February 2012. - Made a loss in the year ended 5 April 2012. - Is budgeted to make tax adjusted trading profits of no more than ￡25,000 per year for the next few years. - Is registered for the purposes of VAT. Ellington and Co - results for the year ended 5 April 2012: - The firm made a tax adjusted trading loss, before deduction of capital allowances, of ￡90,000. - The firm purchased office equipment on 1 December 2011 for ￡21,200. - The balance on the capital allowances main pool as at 5 April 2011 was ￡700. Ellington and Co - profit sharing arrangements: - From 6 April 2011 until 28 February 2012 Ellington Simone Basle Annual salaries ￡15,000 ￡11,500 ￡13,000 Profit sharing ratio 3 : 2 : 2 - From 1 March 2012 Ellington Simone Annual salaries ￡14,000 ￡14,000 Profit sharing ratio 1 : 1 Simone's new business: - Simone intends to start trading on 1 September 2012. - Taxable trading profit is budgeted to be approximately ￡1,500 per month. - Taxable supplies are expected to be between ￡75,000 and ￡95,000 in the first year. - Simone does not wish to register voluntarily for VAT. Required (a) (i) Calculate Simone's share of the tax adjusted trading loss for the year ended 5 April 2012; (ii) State the alternative strategies available to Simone in respect of her share of the taxable trading loss for the year ended 5 April 2012; (iii) Explain, using supporting calculations where necessary, which of the strategies will save the most tax and calculate the total tax saved via the operation of this strategy. Note: your calculations should be based on the assumption that the tax rates and allowances for the year 2011/12 apply to all relevant years. (b) Explain when Simone would be required to register and to start charging her customers VAT and, in relation to this, comment on the relevance of Ellington and Co being VAT registered. Note: you are not required to prepare calculations for part (b) of this question.
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问答题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 2012 she inherited her mother's house in the country of Kaiania, which is outside 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 domiciled 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 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 for commercial organisations. Payments from Reef Ltd to Coral in 2012/13: · Director's fees of ￡460 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 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. · 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 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. (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 2012/13. State the strategy that Coral should adopt in order to minimise the total income tax suffered on the rental income. (ii) Explain how the inclusion of rental income in Coral's UK income tax computation could affect the income tax due on her dividend income. You are not required to prepare calculations for part (b) of this question. Note: you should assume that the tax rates and allowances for the tax year 2011/12 and for the Financial Year to 31 March 2012 will continue to apply for the foreseeable future.
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问答题3.NocturneLtd,apartiallyexemptcompanyforthepurposesofvalueaddedtax(VAT),requiresadviceonthecorporationtaximplicationsofprovidinganassettooneofitsshareholders;theincometaximplicationsforanothershareholderofmakingaloantothecompany;andsimplifyingthewayinwhichitaccountsforVAT.NocturneLtd:–IsaUKresidenttradingcompany.–Preparesaccountsto31Marchannuallyandexpectstopaycorporationtaxattherateof20%.–Hasfourshareholders,eachofwhomowns25%ofthecompany’sordinarysharecapital.–Ownsalaptopcomputer,whichitpurchasedinOctober2012for￡1,200,andwhichhasacurrentmarketvalueof￡150.–Haspurchasednootherplantandmachineryforseveralyearsandthetaxwrittendownvalueofitsmainpoolat31March2015was￡nil.ProvisionofalaptopcomputertooneofNocturneLtd’sshareholders:–NocturneLtdisconsideringtwoalternativewaysofprovidingalaptopcomputerintheyearending31March2016forthepersonaluseofoneofitsshareholders,Jed.–JedisneitheradirectornoranemployeeofNocturneLtd.–Option1:NocturneLtdwillbuyanewlaptopcomputerfor￡1,800andgiveitimmediatelytoJed.–Option2:NocturneLtdwillgiftitsexistinglaptoptoJedandwillpurchaseareplacementforuseinthecompanyfor￡1,800.LoanfromSiglio:–Sigliowillloan￡60,000toNocturneLtdon1October2015tofacilitatethepurchaseofnewequipment.–SiglioisbothashareholderofNocturneLtdandthecompany’smanagingdirector.–NocturneLtdwillpayinterestatacommercialrateontheloanfromSiglio.–Sigliowillborrowthefullamountoftheloanfromhisbankonnormalcommercialterms.VAT–partialexemption:–NocturneLtdispartiallyexemptforthepurposesofVAT.–NocturneLtd’sturnoverfortheyearended31March2015was￡240,000(VATexclusive).–NocturneLtd’sturnoverfortheyearasawholeforVATpurposescomprised86%taxablesuppliesand14%exemptsupplies.–TheinputVATsufferedbyNocturneLtdonexpenditureduringtheyearended31March2015was:–NocturneLtdexpectsitsturnoverandexpenditurefigurestoincreasebyapproximately25%nextyear.–SigliohasheardaboutanannualtestforcomputingtheamountofrecoverableinputVATduringanaccountingperiodandwouldlikemoreinformationaboutthis.Required:
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