1 Dan is looking to sell his buy-to-let flat. What tax, if any, might he have to pay?
a) Income Tax
b) Stamp Duty Land Tax
c) Corporation Tax
d) Capital Gains Tax
2 How much are local authority searches likely to cost on a property purchase?
a) Around £100
b) 1% of the property value
c) Around £1000
d) Nothing. They are provided free.
3 Consolidating a number of existing debts with a lifetime mortgage solves any debt problems. Is this correct?
a) No, a lifetime mortgage is never the right answer.
b) No, getting good debt advice should be the first step.
c) No, home reversion plans are better.
d) Yes.
4 Which of the following is ONE of the two main types of pension scheme?
a) Defined benefit schemes – where the benefits are based on the employer’s discretion.
b) Defined contribution schemes – where the benefits are based on the amount of the accumulated fund.
c) Defined benefit schemes – where the benefits are based on the amount of the accumulated fund.
d) Defined contribution schemes – where the benefits are based on the employee’s earnings at retirement and their number of years with the employer.
5 On a key person income protection plan, who is the benefit paid to?
a) The business
b) The individual employee
c) The business’s customers
d) The business’s shareholders
6 What are water rates charges calculated on?
a) The homeowner’s income
b) The Council Tax band
c) The property’s ground surface area
d) The number of taps the property has
7 How can a borrower monitor the value of their ISA portfolio?
a) By requesting current valuations from the providers or by referring to the latest valuation statements
b) By asking the lender to value the portfolio
c) By multiplying the original value by changes in the FT index since then
d) By reference to an index of house prices
8 What is the maximum fine for a data protection breach under the Data Protection Act?
a) £100,000
b) £10,000
c) £1 million
d) Unlimited
Answers
1 d) CGT may be payable on any capital appreciation.
2 a) Searches typically cost around £100 and are not based on the property’s value.
3 b) Getting good debt advice is the first step. A lifetime mortgage might be part of the solution, but may not be.
4 b) Under defined contribution schemes, the benefits are based on the amount of the accumulated fund. Under defined benefit schemes, they are based on the employee’s earning before retirement and their number of years’ service with the employer.
5 a) The business takes out the cover to protect itself, so the benefit is paid to them.
6 b) Council Tax bands are used by water utility companies as the basis for calculating their charges.
Alternatively customers may have a water meter.
7 a) Valuation statements will show current values but not whether the investment is on track to repay the mortgage at the end of its term.
8 d) The fine is unlimited if it is included in a Crown Court Judgment.
