（c) In April 2006, Keffler was banned by the local government from emptying waste water in

(c) Assuming that Joanne registers for value added tax (VAT) with effect from 1 April 2006:

(i) Calculate her income tax (IT) and capital gains tax (CGT) payable for the year of assessment 2005/06.

You are not required to calculate any national insurance liabilities in this sub-part. (6 marks)

equally. On 28 February 2007 the partners sold the business to Razor Ltd, in exchange for shares in Razor Ltd, with

each former partner owning one third of the new company.

The recent, tax adjusted, trading profits of the Stiletto Partnership have been as follows:

￡

Year ended 30 June 2006 92,124

1 July 2006 to 28 February 2007 81,795

Clint, who was 65 on 5 October 2006, retired when the business was sold to Razor Ltd. He is now suggesting that

if the sale of the partnership, and his retirement, had been delayed until 30 April 2007, his total tax liability would

have been reduced. Clint’s only other income is gross pension income of ￡6,100 per year, which he began receiving

in the tax year 2005/06. Clint did not receive any salary or dividends from Razor Ltd. It is estimated that the

partnership’s tax adjusted trading profits for the period from 1 March 2007 to 30 April 2007 would have been

￡20,760. Clint has overlap profits of ￡14,250 brought forward from when the partnership began trading.

Razor Ltd manufactures industrial cutting tools. On 1 July 2007, Razor Ltd will subscribe for the whole of the ordinary

share capital of Cutlass Inc, a company newly incorporated in the country of Sharpenia. It is intended that Cutlass

Inc will purchase partly finished tools from Razor Ltd and customise them in Sharpenia. It is anticipated that Cutlass

Inc’s annual profits chargeable to corporation tax will be approximately ￡120,000.

Ben and Amy will be the directors of Cutlass Inc, although Ben will not be involved in the company’s business on a

day-to-day basis. Amy intends to spend one or two weeks each month in the country of Sharpenia looking after the

company’s affairs. The remainder of her time will be spent in the UK. Amy has employment contracts with both Razor

Ltd and Cutlass Inc and her duties for Cutlass Inc will be carried out wholly in Sharpenia. Cutlass Inc will pay for

Amy’s flights to and from Sharpenia and for her husband and baby to visit her there twice a year. Amy is currently

UK resident and ordinarily resident.

The system of income tax and corporation tax in the country of Sharpenia is broadly similar to that in the UK although

the rate of corporation tax is 38% regardless of the level of profits. There is a double tax treaty between the UK and

Sharpenia based on the OECD model treaty. The clause in the treaty dealing with company residency states that a

company resident in both countries under domestic law will be regarded under the treaty as being resident only in the

country where it is effectively managed and controlled. Sharpenia is not a member of the European Union.

Required:

(a) (i) Calculate Clint’s taxable trading profits for the tax years 2006/07 and 2007/08 for both of the

alternative retirement dates (28 February 2007 and 30 April 2007). (3 marks)

(ii) Write a letter to Donald advising him on the most tax efficient manner in which he can relieve the loss

incurred in the year to 31 March 2007. Your letter should briefly outline the types of loss relief available

and explain their relative merits in Donald’s situation. Assume that Donald will have no source of income

other than the business in the year of assessment 2006/07 and that any income he earned on a parttime

basis while at university was always less than his annual personal allowance. (9 marks)

Assume that the corporation tax rates and allowances for the financial year 2004 and the income tax rates

and allowances for 2004/05 apply throughout this question.

Relevant retail price index figures are:

January 1998 159·5

April 1998 162·6

(b) Peter, one of Linden Limited’s non-executive directors, having lived and worked in the UK for most of his adult

life, sold his home near London on 22 March 2006 and, together with his wife (a French citizen), moved to live

in a villa which she owns in the south of France. Peter is now demanding that the tax deducted from his director’s

fees, for the board meetings held on 18 April and 16 May 2006, be refunded, on the grounds that, as he is no

longer resident in the UK, he is no longer liable to UK income tax. All of the company’s board meetings are held

at its offices in Cambridge.

Despite Peter’s assurance that none of the other companies of which he is a director has disputed his change of

tax status, Damian is uncertain whether he should make the refunds requested. However, as Peter is a friend of

the company’s founder, Linden Limited’s managing director is urging him to do so, stating that if the tax does

have to be paid, then Linden Limited could always bear the cost.

Required:

Advise Damian whether Peter is correct in his assertion regarding his tax position and in the case that there

is a UK tax liability the implications of the managing director’s suggestion. You are not required to consider

national insurance (NIC) issues. (4 marks)

A．正确

B．错误

For this part, assume today’s date is 15 August 2005.

5 (a) Donald is aged 22, single, and about to finish his university education. He has plans to start up a business selling

computer games, and intends to start trading on 1 April 2006, making up accounts to 31 March annually.

He believes that his business will generate cash (equal to taxable profits) of ￡47,500 in the first year. He

originally intended to operate as a sole trader, but he has recently discovered that as an alternative, he could

operate through a company. He has been advised that if this is the case, he can take a maximum gross salary

of ￡42,648 out of the company.

Required:

(i) Advise Donald on the income tax (IT), national insurance (NIC) and corporation tax (CT) liabilities he

will incur for the year ended 31 March 2007 trading under each of the two alternative business

structures (sole trade/company). Your advice should be supported by calculations of disposable income

for both alternatives assuming that in the company case, he draws the maximum salary stated.

(7 marks)

K注册会计师审计了T公司2005年度的财务报表，出具了无保留意见的审计报告。2006年11月下旬，K注册会计师获知T公司在其2005年度财务报表的审计报告日已存在、可能导致修改审计报告的重大事实。如果这一事实能够在下一期财务报表中进行充分披露，且下一期财务报表仍由K注册会计师审计，则K注册会计师可以将该事实并入2006年度审计业务中，无须提请T公司修改2005年度财务报表并出具相应的审计报告。注册会计师应当考虑是否需要修改财务报表。()

A．正确

B．错误

capital of Hira Ltd from Belgrove Ltd. Belgrove Ltd currently owns 100% of the share capital of Hira Ltd and has no

other subsidiaries. All three companies have their head offices in the UK and are UK resident.

Hira Ltd had trading losses brought forward, as at 1 April 2006, of ￡18,600 and no income or gains against which

to offset losses in the year ended 31 March 2006. In the year ending 31 March 2007 the company expects to make

further tax adjusted trading losses of ￡55,000 before deduction of capital allowances, and to have no other income

or gains. The tax written down value of Hira Ltd’s plant and machinery as at 31 March 2006 was ￡96,000 and

there will be no fixed asset additions or disposals in the year ending 31 March 2007. In the year ending 31 March

2008 a small tax adjusted trading loss is anticipated. Hira Ltd will surrender the maximum possible trading losses

to Belgrove Ltd and Dovedale Ltd.

The tax adjusted trading profit of Dovedale Ltd for the year ending 31 March 2007 is expected to be ￡875,000 and

to continue at this level in the future. The profits chargeable to corporation tax of Belgrove Ltd are expected to be

￡38,000 for the year ending 31 March 2007 and to increase in the future.

On 1 February 2007 Dovedale Ltd will sell a small office building to Hira Ltd for its market value of ￡234,000.

Dovedale Ltd purchased the building in March 2005 for ￡210,000. In October 2004 Dovedale Ltd sold a factory

for ￡277,450 making a capital gain of ￡84,217. A claim was made to roll over the gain on the sale of the factory

against the acquisition cost of the office building.

On 1 April 2007 Dovedale Ltd intends to acquire the whole of the ordinary share capital of Atapo Inc, an unquoted

company resident in the country of Morovia. Atapo Inc sells components to Dovedale Ltd as well as to other

companies in Morovia and around the world.

It is estimated that Atapo Inc will make a profit before tax of ￡160,000 in the year ending 31 March 2008 and will

pay a dividend to Dovedale Ltd of ￡105,000. It can be assumed that Atapo Inc’s taxable profits are equal to its profit

before tax. The rate of corporation tax in Morovia is 9%. There is a withholding tax of 3% on dividends paid to

non-Morovian resident shareholders. There is no double tax agreement between the UK and Morovia.

Required:

(a) Advise Belgrove Ltd of any capital gains that may arise as a result of the sale of the shares in Hira Ltd. You

are not required to calculate any capital gains in this part of the question. (4 marks)