(b) (i) Advise Alasdair of the tax implications and relative financial risks attached to the following propertyinvestments:(1) buy to let residential property;(2) commercial property; and(3) shares in a property investment company/unit trust. (9 marks)

题目

(b) (i) Advise Alasdair of the tax implications and relative financial risks attached to the following property

investments:

(1) buy to let residential property;

(2) commercial property; and

(3) shares in a property investment company/unit trust. (9 marks)

更多“(b) (i) Advise Alasdair of the tax implications and relative financial risks attached to the following propertyinvestments:(1) buy to let residential property;(2) commercial property; and(3) shares in a property investment company/unit trust. (9 marks)”相关问题

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(b) (i) Advise Benny of the income tax implications of the grant and exercise of the share options in SummerGlow plc on the assumption that the share price on 1 September 2007 and on the day he exercises theoptions is ￡3·35 per share. Explain why the share option scheme is not free from risk by reference tothe rules of the scheme and the circumstances surrounding the company. (4 marks)

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第2题

(ii) Compute the annual income tax saving from your recommendation in (i) above as compared with thesituation where Cindy retains both the property and the shares. Identify any other tax implicationsarising from your recommendation. Your answer should consider all relevant taxes. (3 marks)

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第3题

(b) For this part, assume today’s date is 1 May 2010.Bill and Ben decided not to sell their company, and instead expanded the business themselves. Ben, however,is now pursuing other interests, and is no longer involved with the day to day activities of Flower Limited. Billbelieves that the company would be better off without Ben as a voting shareholder, and wishes to buy Ben’sshares. However, Bill does not have sufficient funds to buy the shares himself, and so is wondering if thecompany could acquire the shares instead.The proposed price for Ben’s shares would be ￡500,000. Both Bill and Ben pay income tax at the higher rate.Required:Write a letter to Ben:(1) stating the income tax (IT) and/or capital gains tax (CGT) implications for Ben if Flower Limited were torepurchase his 50% holding of ordinary shares, immediately in May 2010; and(2) advising him of any available planning options that might improve this tax position. Clearly explain anyconditions which must be satisfied and quantify the tax savings which may result.(13 marks)Assume that the corporation tax rates for the financial year 2005 and the income tax rates and allowancesfor the tax year 2005/06 apply throughout this question.

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第4题

6 Andrew is aged 38 and is single. He is employed as a consultant by Bestadvice & Co and pays income tax at thehigher rate.Andrew is considering investing in a new business, and to provide funds for this investment he has recently disposedof the following assets:(1) A short leasehold interest in a residential property. Andrew originally paid ￡50,000 for a 47 year lease of theproperty in May 1995, and assigned the lease in May 2006 for ￡90,000.(2) His holding of ￡10,000 7% Government Stock, on which interest is payable half-yearly on 20 April and20 October. Andrew originally purchased this holding on 1 June 1999 for ￡9,980 and he sold it for ￡11,250on 14 March 2005.Andrew intends to subscribe for ordinary shares in a new company, Scalar Limited, which will be a UK basedmanufacturing company. Three investors (including Andrew) have been identified, but a fourth investor may also beinvited to subscribe for shares. The investors are all unconnected, and would subscribe for shares in equal measure.The intention is to raise ￡450,000 in this manner. The company will also raise a further ￡50,000 from the investorsin the form. of loans. Andrew has been told that he can take advantage of some tax reliefs on his investment in ScalarLimited, but does not know anything about the details of these reliefsAndrew’s employer, Bestadvice & Co, is proposing to change the staff pension scheme from a defined benefit schemeto which the firm and the employees each contribute 6% of their annual salary, to a defined contribution scheme, towhich the employees will continue to contribute 6%, but the firm will contribute 8% of their annual salary. Themajority of Andrew’s colleagues are opposed to this move, but, given the increase in the firm’s contribution rateAndrew himself is less sure that the proposal is without merit.Required:(a) (i) Calculate the chargeable gain arising on the assignment of the residential property lease in May 2006.(2 marks)

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第5题

(ii) Advise Andrew of the tax implications arising from the disposal of the 7% Government Stock, clearlyidentifying the tax year in which any liability will arise and how it will be paid. (3 marks)

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第6题

2 Clifford and Amanda, currently aged 54 and 45 respectively, were married on 1 February 1998. Clifford is a higherrate taxpayer who has realised taxable capital gains in 2007/08 in excess of his capital gains tax annual exemption.Clifford moved into Amanda’s house in London on the day they were married. Clifford’s own house in Oxford, wherehe had lived since acquiring it for ￡129,400 on 1 August 1996, has been empty since that date although he andAmanda have used it when visiting friends. Clifford has been offered ￡284,950 for the Oxford house and has decidedthat it is time to sell it. The house has a large garden such that Clifford is also considering an offer for the house anda part only of the garden. He would then sell the remainder of the garden at a later date as a building plot. His totalsales proceeds will be higher if he sells the property in this way.Amanda received the following income from quoted investments in 2006/07:￡Dividends in respect of quoted trading company shares 1,395Dividends paid by a Real Estate Investment Trust out of tax exempt property income 485On 1 May 2006, Amanda was granted a 22 year lease of a commercial investment property. She paid the landlorda premium of ￡6,900 and also pays rent of ￡2,100 per month. On 1 June 2006 Amanda granted a nine yearsub-lease of the property. She received a premium of ￡14,700 and receives rent of ￡2,100 per month.On 1 September 2006 Amanda gave quoted shares with a value of ￡2,200 to a registered charity. She paid broker’sfees of ￡115 in respect of the gift.Amanda began working for Shearer plc, a quoted company, on 1 June 2006 having had a two year break from hercareer. She earns an annual salary of ￡38,600 and was paid a bonus of ￡5,750 in August 2006 for agreeing tocome and work for the company. On 1 August 2006 Amanda was provided with a fully expensed company car,including the provision of private petrol, which had a list price when new of ￡23,400 and a CO2 emissions rate of187 grams per kilometre. Amanda is required to pay Shearer plc ￡22 per month in respect of the private use of thecar. In June and July 2006 Amanda used her own car whilst on company business. She drove 720 business milesduring this two month period and was paid 34 pence per mile. Amanda had PAYE of ￡6,785 deducted from her grosssalary in the tax year 2006/07.After working for Shearer plc for a full year, Amanda becomes entitled to the following additional benefits:– The opportunity to purchase a large number of shares in Shearer plc on 1 July 2007 for ￡3·30 per share. It isanticipated that the share price on that day will be at least ￡7·50 per share. The company will make an interestfreeloan to Amanda equal to the cost of the shares to be repaid in two years.– Exclusive free use of the company sailing boat for one week in August 2007. The sailing boat was purchased byShearer plc in January 2005 for use by its senior employees and costs the company ￡1,400 a week in respectof its crew and other running expenses.Required:(a) (i) Calculate Clifford’s capital gains tax liability for the tax year 2007/08 on the assumption that the Oxfordhouse together with its entire garden is sold on 31 July 2007 for ￡284,950. Comment on the relevanceto your calculations of the size of the garden; (5 marks)

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第7题

(ii) Advise Mr Fencer of the income tax implications of the proposed financing arrangements. (2 marks)

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(b) (i) Advise Alasdair of the tax implications and relative financial risks attached to the following propertyinvestments:(1) buy to let residential property;(2) commercial property; and(3) shares in a property investment company/unit trust. (9 marks)

题目

更多“(b) (i) Advise Alasdair of the tax implications and relative financial risks attached to the following propertyinvestments:(1) buy to let residential property;(2) commercial property; and(3) shares in a property investment company/unit trust. (9 marks)”相关问题

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