15 Frederick works as an employee of Wood Ltd. Frederick's only source of income is employment income.

Frederick's
taxable income (after deduction of the personal allowance) for 2023/24 was £15,815. During 2023/24 Frederick paid
£3,100 in income tax via PAYE.

Requirement
What is Frederick's income tax payable under self-assessment for 2023/24?

LO 3h

16 Darcy is self-employed and has trading profits assessable in 2023/24 of £198,000.

Requirement
What is Darcy's personal allowance for 2023/24?
You may enter your answer as a positive or negative number

LO3b

17 Dahlia has taxable income in 2023/24 of £133,000 (non-savings income), £27,600 (savings income) and £1 5,000
(dividend income).

Requirement
What is Dahlia's income tax liability for 2023/24?
A £63,757
B £64,376
C £58,326
D £63,982
LO 3h

18 Diane is self-employed and has trading profits assessable in 2023/24 of £1 1 8,000.

Requirement
What is Diane's personal allowance for 2023/24?
You may enter your answer as a positive or negative number

LO3b

1 9 Geoff had taxable income (after deduction of his personal allowance) of £1 4,450 of non-savings income in 2023/24. His
civil partner, Jessica, had n o income during 2023/24. Jessica made a marriage allowance election in 2023/24.

Requirement
What is Geoff's income tax liability for 2023/24?

LO 3h
2 0 During 2023/24 Leanne was a higher-rate taxpayer (net income of £80,000) but her husband Richard stayed at home to
look after their children, a n d had n o income in 2023/24. Both Leanne and Richard are aged 40.

Requirement
Which of the following statements about the personal allowance is true?
A Leanne's personal allowance is reduced because her income exceeds the basic rate band.
B An election can b e made to transfer all of Richard's personal allowance to Leanne.
C An election can b e made to transfer £1,260 of Richard's personal allowance to Leanne.
D N o election can be made to transfer any part of Richard's personal allowance to Leanne.
LO3b

21 Sarah is married to Arthur. Sarah has net income in 2023/24 of £29,900. Arthur has net income for 2023/24 of £10,000.
Wherever possible they claim the marriage allowance.
Requirement
What is Sarah's taxable income in 2023/24?
A £12,570
B £17,330
C £16,070
D £29,900
LO3b

22 Sheila has taxable income after deducting the personal allowance {all non-savings income) in 2023/24 of £40,200. She is
married to Alice, who has net income i n 2023/24 of £9,000. Wherever possible they claim the marriage allowance.

Requirement
What is Sheila's income tax liability for 2023/24?

LO3b

23 Maalik is employed by Artichoke Ltd and has taxable income i n 2023/24 of £20,000 (after deduction of the personal
allowance). O n 1 December 2023 Maalik paid £420 to a charity under the Gift A i d provisions.

Requirement
In 2023/24 the Gift Aid payment will:
A Increase Maalik's income tax liability
B Decrease Maalik's income tax liability
C Have no impact o n Maalik's income tax liability
D Generate a refund of income tax payable to Maalik
LO 3h

2 4 Sandra has rental profits assessable in 2023/24 of £128,000.

Requirement
What is Sandra's personal allowance for 2023/24?
You may enter your answer as a positive or negative number

LO3b
4 Employment income

1 Mustafa is an employee of W i n d o w Ltd with a gross annual salary of £1 7,000. Mustafa underpaid his tax for 2021 722 by
£910. Mustafa has agreed with HMRC that this underpayment will be collected via his PAYE c o d e for 2023/24.

Requirement
What is Mustafa's PAYE code for 2023/24?
A 802L
B 1029L
C 1166L
D 1712L
LO2b

2 Parminder is a n employee of Sales Ltd with a gross annual salary of £50,000. Parminder also has taxable benefits relating
to accommodation worth £1 7,970 for 2023/24.
Requirement
What is Parminder's PAYE code for 2023/24?

PAYE code K

Note: Because Parminder's benefits relate to accommodation, they cannot be taxed via voluntary payrolling.
LO2b

3 Jamelia earns £60,000 a year. She is entitled to a basic personal allowance. Heir employer, June Ltd, provides her with a
company car with a taxable benefit of £1 3,195. June Ltd does not use voluntary payrolling of benefits.
Requirement
What is Jamelia's PAYE code for 2023/24?
A 62L
B K625
C K62
D K61
LO2b

4 Jacob earns £15,000 a year. His employer provides him with taxable benefits of £5,630. Jacob's employer does not use
voluntary payrolling of benefits.
Requirement
What is Jacob's PAYE c o d e for 2023/24?

LO 2 b
5 Dana has total income of £51,000 each year. She has underpaid tax of £1,400 in 2021/22 which is recovered through her
PAYE code in 2023/24.

Requirement
What is Dana's PAYE code for 2023/24?
A 557L
B 907L
C 1117L
D 1257L
LO2b
5 Trading profits

1 Which two of the following statements indicate that a trade is being carried on?
A Amy has just sold a house that she bought three months ago. She has spent £40,000 to make the property more
attractive to potential purchasers. Amy has not lived in this house.
B Ben has sold some shares that he has owned for 10 years for substantially more than the original cost
C Caitlin, a student, has cash flow problems and sells a carthat she bought three months ago.
D Dante has an interest in vintage cars. He has just sold a car that he has been renovating for the last six months. This is
the seventh renovated carthat he has sold in the last two years.
LO3d

2 Which two of the following are not badges of trade?

A The number of transactions
B Provision of own equipment
C Profit seeking motive
D Changes to the asset
E Correction of own work
LO3d

3 According to the badges of trade, HMRC would probably view the purchase of 1,000,000 toilet rolls by an individual as
being carried out:
A For personal use
B Fortheir aesthetic value
C For long-term investment
D To be sold at a profit
LO3d

4 Marina has trading receipts in 2023/24 of £1,300 and deductible expenses of £750. She makes all beneficial claims and
elections.
Requirement
What is Marina's trading income assessment in 2023/24?
A £0
B £250
C £300
D £1,000
LO3e
5 Penha has a hobby restoring antique furniture. He has just sold a restored antique table that he has owned for several
years He sold 10 items of restored furniture in 2023/24.

Requirement
Which two of the following badges indicate that Penha is carrying o n a trade in relation to this disposal?
A The number of transactions
B Interval of time between purchase a n d sale
C Changes to the asset
D Correction of own work
LO3d

6 Julie is a full-time employee working in the fitness industry and earns a salary of £20,000 per year. She also runs an online
fitness and lifestyle blog from which she receives advertising revenue. During the year e n d e d 5 April 2024 her income
from the b l o g totalled £900 and associated deductible expenses were £400.
Requirement
What is Julie's taxable trading income for 2023/24?
A £Nil
B £500
C £900
D £20,500
LO3e
6 Capital allowances

1 Nina began trading on 1 January 2023 and prepared accounts for the year ended 31 December 2023. O n 1 March 2023
she purchased a photocopier for £2,300 a n d a car with emissions of 2 8 g/km for £2,300. The photocopier and the car are
both used for business purposes for 90% of the time.

Requirements
The maximum capital allowances that Nina will receive in respect of the purchase of the photocopier in the year ended 31
December 2023 are:
A £2,300
B £2,070
C £373
The maximum capital allowances that Nina will receive in respect of the purchase of the car in the year ended 31
December 2023 are:
D £2,300
E £414
F £373
LO3e

2 Aasia began trading o n 1 March 2023 and prepared accounts for the period e n d e d 31 December 2023. O n 1 5 March
2023 she purchased a photocopier for £3,000 and a car with emissions of 45 g/km for £3,000. The photocopier and the
car are only used for business purposes.
Requirements
The maximum capital allowances that Aasia will receive in respect of the purchase of the photocopier in the period e n d e d
31 December 2023 are:
A £3,000
B £2,500
C £450
The maximum capital allowances that Aasia will receive in respect of the purchase of the car in the period ended 31
December 2023 are:
D £3,000
E £540
F £450
LO3e

3 Leona began trading on 1 January 2023, preparing her first accounts to 30 April 2023. O n 1 March 2023 she purchased a
computer for £5,000 and a car with emissions of 35 g/km for £1 3,200. Both assets are only used for business purposes.

Requirements
The maximum capital allowances available on the computer in the period to 30 April 2023 are:
A £5,000
B £1,667
C £300
The maximum capital allowances available o n the car in the period to 30 April 2023 are:
D £13,200
E £2,376
F £792
LO3e
4 Barbara began trading o n 1 January 2023. On 1 December 2023 Barbara purchased a van for £1 3,200. The van is used by
her 80% of the time for business purposes and has C O 2 emissions of 42 g/km.
Requirement
What is the maximum capital allowance claim available to Barbara for the year e n d e d 31 December 2023?
A £1,901
B £2,376
C £10,560
D £13,200
LO3e

5 The following sentences have been included in a draft letter to a client who is about to start a new business.
Identify whether each statement is correct or incorrect.
Requirements
Expend itu re o n new cars emitting zero C O 2 qua lifies for the annual i n vestment allowance ( AIA) of 1 00%.
A Correct
B Incorrect
Capital expenditure is not allowable in computing trading profits but will always result in capital allowances.
C Correct
D Incorrect
LO 3a

6 Murphy began trading o n 1 January 2023 and drew u p his first accounts to 31 December 2023.
He made the following purchases of assets.

1 July 2023 Machinery 1,014,000

1 September 2023 Motor car (electric) 16,500

Murphy used the motor car only for business purposes.

Requirement
What are Murphy's maximum capital allowances for the period ended 31 December 2023?

LO3e

7 Jack has been trading for many years making up accounts to 31 March.
The only asset in the business for the purpose of capital allowances is a car bought in 201 5 with CO 2 emissions of 1 09
g/km, which Jack uses 75% for business purposes. The tax written d o w n value of the carat 1 April 2023 was £15,000.
O n 1 September 2023 Jack sold the car for £10,200.
Requirement
What are the maximum capital allowances available to Jack for the year ended 31 March 2024?
A £2,025
B £2,700
C £3,600
D £4,800
LO3e