I have prepared Revision notes of the whole syllabus for F7, F8, P2 (int), P6 (uk) and p7 exams.
It has all the necessary and up-to-date content for exams to be taken from sept 2017 to june 2018
In my opinion these notes are more than sufficient to pass the exam with flying colours. It has all w...
Table of contents
Contents Page number
Introduction to UK taxation 3
Income tax 4
Family tax planning 9
Tax adjusted trading profits 10
Basis of assessment for trading profits 11
Trading losses 13
Employment income 14
Business property income 21
Investment schemes 23
Partnership tax rules 27
Income tax overseas aspects 28
Personal financial planning 29
Corporation tax 30
Chargeable gain for companies 34
Groups of companies 38
Overseas aspects of companies 40
Capital gain tax (CGT) 41
Overseas aspects of CGT 47
Value added tax (VAT) 48
Overseas aspects of VAT 55
Inheritance tax (IHT) 57
Overseas aspects of IHT 64
Taxation for trusts 65
2 Prepared by: Arif Javed (FCCA), 0321- 66 96 281
,ACCA P6 (UK) Summary Notes [ADVANCE TAXATION]
INTRODUCTION TO UK TAXATION
There are five major types of taxes in UK
1. Income Tax (IT)
2. Corporation Tax (CT)
3. Capital gain Tax (CGT)
4. Value added Tax (VAT)
5. Inheritance Tax (IHT)
Income Tax (IT), Corporation Tax (CT), Capital Gain Tax (CGT) and Inheritance Tax
(IHT) are all direct taxes while Value Added Tax (VAT) is an indirect tax.
UK Taxation
Income Tax (IT) Corporation Tax Capital Gain Tax Value Added Tax Inheritance Tax
(CT) (CGT) (VAT) (IHT)
Paid by individuals
Paid by companies Paid by individuals
Paid by individuals Paid by individuals on transfer of value
on incomes and and companies on
on incomes on capital gains during lifetime or at
capital gains sales turnover
death
Direct tax is one which is directly paid to HMRC by the tax payer.
Indirect tax is one which is not directly paid to HMRC by the tax payer rather it is paid
through other entities.
3 Prepared by: Arif Javed (FCCA), 0321- 66 96 281
, ACCA P6 (UK) Summary Notes [ADVANCE TAXATION]
Income tax
Income tax is paid by individuals on taxable income on the basis of tax year.
Tax year runs from 6 April to 5 April. Tax year 2015-16 runs from 6 April 2016 to 5 April
2017. It is examinable from April 2017 to April 2018 in ACCA F6 and P6 exams.
Taxable income
Taxable income is calculated as:
NSI SI DI
£ £ £
Trading profits x - -
Employment income x - -
Business property income x - -
Foreign income x - -
Other income x - -
Investment income - x -
Dividend income - - x
--- --- ---
Gross income x x x
Qualifying interest (x) - -
--- --- ---
Net income x x x
Personal allowance (x) - -
-- -- --
Taxable income x x x
--- --- ---
Once the taxable income is calculated, income tax is calculated using following rates.
NSI SI DI
Starting rate band (1 – 5,000) 20% 0% 0%
Basic rate band (5,001 – 32,000) 20% 20% 7.5%
Higher rate band (32,001 – 150,000) 40% 40% 32.5%
Additional rate band (> 150,000) 45% 45% 38.1%
4 Prepared by: Arif Javed (FCCA), 0321- 66 96 281
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