EXAMINABLE DOCUMENTS - JUNE 2011 AND DECEMBER 2011 Papers F6 (UK) Taxation and P6 (UK) Advanced Taxation The following notes

refer to Papers F6 (UK) and P6 (UK) only. Guidance for other variant papers – where available – is published on the ACCA website. Legislation which received Royal Assent on or before 30 September annually will be assessed in the examination sessions being held in the following calendar year. Therefore, examinations in June 2011 and December 2011 will be assessed on legislation which received Royal Assent on or before 30 September 2010. Finance Act The latest Finance Acts which will be examined in Papers F6 (UK) and P6 (UK) at the June and December 2011 sessions are the Finance (No 1) Act 2010 and the Finance (No 2) Act 2010. With regard to prospective legislation when, for example, provisions included in the Finance Act will only take effect at some date in the future, such legislation will not normally be examined until such time as it actually takes effect. The same rule applies to the effective date of the provisions of an Act introduced by statutory instrument. Articles The following relevant articles have been published in Student Accountant and are also available on the ACCA website: F6 (UK):  Finance Act 2010 – September 2010  Inheritance tax (Parts 1 & 2) – October 2010  Adjustment of profit questions – November 2009  Examiner’s approach to Paper F6 (UK) – January 2007 Upcoming articles:  Capital gains tax (Parts 1 & 2)  Value added tax P6 (UK):  Finance Act 2010 – September 2010  Examiner’s approach to Paper P6 (UK) – June/July 2007 The following articles are updated each year for changes in the Finance Act  Trusts and tax for P6 (UK)  Corporation tax for P6 (UK  Capital gains tax and inheritance tax for P6 (UK)  International travellers for P6 (UK)  Corporation tax for groups for P6 (UK) Upcoming article  Examiner’s approach to section A questions Supplementary Instructions and Tax Rates and Allowances The following supplementary instructions and tax rates and allowances will be reproduced in the exam paper in the June and December 2011 exams. The tick () indicates whether this information is included, and therefore examinable, in Paper F6 (UK) and Paper P6 (UK). In addition, other specific information necessary for candidates to answer individual questions will be given as part of the question.

SUPPLEMENTARY INSTRUCTIONS 1. 2. 3. 4. You should assume that the tax rates and allowances for the tax year 2010/11 and for the financial year to 31 March 2011 will continue to apply for the foreseeable future unless you are instructed otherwise. Calculations and workings need only be made to the nearest £. All apportionments should be made to the nearest month. All workings should be shown.

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Income tax Normal rates % 20 40 50 Dividend rates % 10 32.5 42.5

Basic rate Higher rate Additional rate

£1 − £37,400 £37,401 to £150,000 £150,001 and over

A starting rate of 10% applies to savings income where it falls within the first £2,440 of taxable income. Personal allowances Personal allowance Income limit for age related allowances Income limit for standard personal allowance Car benefit percentage The base level of CO2 emissions is 130 grams per kilometre. Petrol cars with CO2 emissions of 75 grams per kilometre or less Petrol cars with CO2 emissions between 76 and 120 grams per kilometre Car fuel benefit The base figure for calculating the car fuel benefit is £18,000. Pension scheme limits Annual allowance Lifetime allowance The maximum contribution that can qualify for tax relief without evidence of earnings Authorised mileage allowances: cars Up to 10,000 miles Over 10,000 miles Capital allowances: rates of allowance Plant and machinery Main pool Special rate pool Motor cars (purchases since 6 April 2009 (1 April 2009 for limited companies)) CO2 emissions up to 110 grams per kilometre CO2 emissions between 111 and 160 grams per kilometre CO2 emissions over 160 grams per kilometre Annual investment allowance First £100,000 of expenditure Industrial buildings Writing-down allowance Corporation tax Financial year Small companies rate Main rate Lower limit Upper limit Standard fraction 2008 21% 28% £ 300,000 1,500,000 7/400 2009 21% 28% £ 300,000 1,500,000 7/400 2010 21% 28% £ 300,000 1,500,000 7/400 % 20 10 100 20 10 100 1 40p 25p £255,000 £1,800,000 £3,600 % 5 10 Standard 65 – 74 75 and over £ 6,475 9,490 9,640 22,900 100,000

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Marginal relief Standard fraction x (U − A) x N/A Value added tax Standard rate - up to 3 January 2011 - from 4 January 2011 onwards Registration limit Deregistration limit Inheritance tax: tax rates £1 – £325,000 Excess – Death rate – Lifetime rate Inheritance tax: taper relief Years before death: More than 3 but less More than 4 but less More than 5 but less More than 6 but less Capital gains tax Rates of tax – Lower rate – Higher rate Annual exemption Entrepreneurs’ relief – Lifetime limit – Rate of tax National insurance contributions (not contracted out rates) Class 1 Employee £1 − £5,715 per year £5,716 − £43,875 per year £43,876 and above per year £1 − £5,715 per year £5,716 and above per year % Nil 11.0 1.0 Nil 12.8 12.8 £2.40 per week Small earnings exception limit − £5,075 £1 − £5,715 per year £5,716 − £43,875 per year £43,876 and above per year Nil 8.0 1.0 % 18 28 £10,100 £5,000,000 10% than than than than 4 5 6 7 years years years years Percentage reduction 20 40 60 80 % Nil 40 20 17.5% 20% £70,000 £68,000

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Class 1 Employer Class 1A Class 2 Class 4

Rates of interest (assumed) Official rate of interest Rate of interest on underpaid tax Rate of interest on overpaid tax Stamp duty land tax £150,000 or £150,001 − £250,001 − £500,001 or less (1) £250,000 (2) £500,000 more % Nil 1 3 4 4% 3% 0.5%

(1) For residential property, the nil rate is restricted to £125,000. (2) From 25 March 2010 to 24 March 2012 there is an exemption for first time buyers purchasing residential properties for no more than £250,000. Stamp duty Shares 0.5%

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