Chartered Institute of Public Finance and Accountancy (CIPFA) Taxation Syllabus

Taxation syllabus — full chapter and topic list

Expand any chapter to see its topics and sub-topics. This is the whole examinable outline for Taxation in Chartered Institute of Public Finance and Accountancy (CIPFA), not a summary of it.

1. 1

   The UK Tax System and Administration

   3 topics

   • Structure of UK Taxation and HMRC
     • Sources of tax law and interpretation
     • Self-assessment and filing obligations
     • Penalties, interest and compliance checks
   • Ethics and Tax Avoidance versus Evasion
   • Residence, Domicile and Scope of Charge
2. 2

   Income Tax and National Insurance

   3 topics

   • Computation of Taxable Income
     • Employment income and benefits in kind
     • Trading income and adjustments to profit
     • Property and savings income
   • Personal Allowances and Tax Bands
   • National Insurance Contributions
     • Class 1 employee and employer contributions
     • Class 2 and Class 4 for the self-employed
3. 3

   Corporation Tax

   4 topics

   • Computation of Taxable Total Profits
   • Capital Allowances
     • Plant and machinery and the annual investment allowance
     • Writing down allowances and pools
   • Losses and Group Relief
   • Payment of Corporation Tax
4. 4

   Indirect Taxes and the Public Sector

   3 topics

   • Value Added Tax Principles
     • Output and input tax
     • Registration and deregistration
     • VAT returns and schemes
   • VAT and Local Authorities
     • Section 33 refund mechanism
     • Business and non-business activities
     • Partial exemption
   • Capital Gains Tax and Chargeable Gains for Companies

Taxation flashcards for Chartered Institute of Public Finance and Accountancy (CIPFA)

23 of 64 cards from the Taxation deck — real questions with worked answers.

1. What are the two main categories of UK taxes, and give an example of each?

   Direct taxes (levied on income/gains/wealth, e.g. Income Tax, Corporation Tax, Capital Gains Tax) and Indirect taxes (levied on spending/consumption, e.g. VAT, excise duties).

2. What is HMRC and what is its primary role in the UK tax system?

   His Majesty's Revenue and Customs is the UK's non-ministerial government department responsible for collecting taxes, administering the tax system, paying certain state benefits/tax credits, and enforcing compliance.

3. Which body sets UK tax policy and law, as distinct from the body that administers it?

   HM Treasury (and Parliament via the annual Finance Act) sets tax policy and legislates; HMRC administers and collects the taxes.

4. Name the three sources of UK tax law.

   Statute law (Acts of Parliament such as the annual Finance Acts), case law (decisions of the courts/tribunals), and HMRC guidance/Statements of Practice and Extra-Statutory Concessions.

5. What is the structure of the UK tax appeals system (first-tier)?

   Disputes are heard first by the First-tier Tribunal (Tax Chamber), with appeals on points of law going to the Upper Tribunal, then the Court of Appeal and Supreme Court.

6. Define tax evasion.

   Tax evasion is the illegal non-payment or underpayment of tax, usually by deliberately misrepresenting or concealing income, gains or facts from HMRC. It is a criminal offence.

7. Define tax avoidance and explain how it differs from evasion.

   Tax avoidance is arranging affairs within the law to minimise tax. It is legal (though aggressive avoidance may be challenged), whereas evasion is illegal concealment/misrepresentation.

8. What is the UK General Anti-Abuse Rule (GAAR) designed to counter?

   The GAAR counters abusive tax arrangements that, viewed objectively, cannot reasonably be regarded as a reasonable course of action — i.e. it targets artificial and abusive avoidance schemes.

9. What are the five fundamental ethical principles for accountants under the IESBA/ICAEW Code relevant to tax work?

   Integrity, Objectivity, Professional competence and due care, Confidentiality, and Professional behaviour.

10. Under the DOTAS regime, what must a promoter of a notifiable tax avoidance scheme do?

    Disclose the scheme to HMRC, who issue a Scheme Reference Number (SRN) that users must report on their tax returns (Disclosure of Tax Avoidance Schemes).

11. What two factors primarily determine an individual's liability to UK Income Tax on worldwide vs UK income?

    Residence and domicile status — residence determines the basic scope of charge, while domicile (and the remittance basis) affects taxation of foreign income and gains.

12. What test determines whether an individual is UK resident for tax purposes?

    The Statutory Residence Test (SRT), which applies the automatic overseas tests, the automatic UK tests, and the sufficient ties test based on days in the UK and connecting factors.

13. Define 'domicile' in UK tax law and name its main types.

    Domicile is the country a person regards as their permanent home. Types: domicile of origin (at birth), domicile of dependence, and domicile of choice (acquired by residing with intent to remain permanently).

14. What is the 'remittance basis' of taxation?

    An option for UK-resident, non-UK-domiciled individuals to be taxed on foreign income and gains only when remitted (brought) to the UK, rather than on the arising basis.

15. On what basis is a UK-resident, UK-domiciled individual charged to Income Tax?

    On the arising basis — taxed on their worldwide income and gains as they arise, regardless of where in the world they are earned.

16. List the three categories of income in the personal Income Tax computation, in the order they are taxed.

    Non-savings income (e.g. employment, trading, property), then savings income (interest), then dividend income — taxed in that order, with dividends taxed last (top slice).

17. Define 'Net Income' in the personal Income Tax computation.

    Net income is total income from all sources less reliefs deductible from total income (such as qualifying loan interest and trading loss relief), before deducting the personal allowance.

18. Write the formula for an individual's Taxable Income.

    $$\text{Taxable Income} = \text{Net Income} - \text{Personal Allowance}$$

19. What is the standard UK personal allowance for 2024/25?

    $£12{,}570$.

20. How is the personal allowance restricted for high earners?

    It is reduced by $£1$ for every $£2$ that adjusted net income exceeds $£100{,}000$, so it is fully withdrawn once adjusted net income reaches $£125{,}140$.

21. Write the formula for the personal allowance restriction given adjusted net income (ANI) above £100,000.

    $$\text{Reduced PA} = £12{,}570 - \frac{\text{ANI} - £100{,}000}{2}$$ (not below zero).

22. State the three main Income Tax bands and rates on non-savings income for 2024/25 (excluding Scotland).

    Basic rate $20\%$ on taxable income up to $£37{,}700$; higher rate $40\%$ from $£37{,}701$ to $£125{,}140$; additional rate $45\%$ above $£125{,}140$.

23. What are the dividend tax rates for 2024/25 at basic, higher and additional rates?

    $8.75\%$ (basic), $33.75\%$ (higher) and $39.35\%$ (additional rate).

See more Taxation flashcards →

Planning Taxation for Chartered Institute of Public Finance and Accountancy (CIPFA)

Taxation (Chartered Institute of Public Finance and Accountancy (CIPFA)) FAQ