Taxation Northern Ireland

Transcription

1 Professional, Practical, Proven Taxation Northern Ireland Examiner: Paul Stewart October 2016

2 Agenda Statistics Syllabus review Areas for improvement (topic by topic) Overview of Areas for Improvement

3 Statistics Taxation (NI) Statistics % Pass Rate May August Overall* % 58% 82% % 69% 75% % 58% 80% * Overall refers to the total percentage of students that passed the exam in the Academic Year (May and August combined)

4 Administration and Procedures Relatively few changes. Anything new in this context is dictated by legislative changes as included in the manual. In the main, narrative questions on admin/procedures can be confused. Where exam candidates make mistakes it is often in confusing the administration of income tax & VAT. Will continue with short-form narrative questions to interrogate this element of the syllabus. Administration & procedures can & will be embedded within other questions e.g. the PAYE question.

5 Personal Taxation Significantly the introduction of the new PSA and DA. These are important changes & will be thoroughly examined in IT computation questions is usually well answered when this isn t so it can be a clear marker of a weaker candidate. Areas to look out for: Those with income > 100k Joint Income Treatment of some benefits e.g. loans, loaned/transferred assets, expensive accomodation Treatment of deductions e.g. pension contributions, BIK or other adjustments do not adjust PA! Absence of structure/discipline in answer or foundational knowledge

6 Adjusted Profits A generally well answered question when it comes up but, when it comes up please avoid non-standard layout (other than add backs to net profit)! These still crop up and are COMPLETELY unacceptable. Students should NOT reconstruct the profit & loss account! Students should NOT bury the answer in an absence of workings! Marks can be lost due to carelessness e.g. getting private/public proportion the wrong way around. Marks can be saved when candidates explain themselves! Look out for questions where income is reported (from which allowable expenditure may be deducted).

7 Pay As You Earn Employment vs. Self-employment Some confusion still crops up in this area with respect to the order or flow of the computation (e.g. deducting tax paid to date from cumulative income before taxing. Calculation of take home pay Week 1/Month 1/Cumulative basis/mix of codes Completion of Revenue forms (P11) will not be required Will continue to mix up PAYE computations & narrative elements examining relevant administrative procedures Continued confusion for some candidates with respect to CCV, pension contributions, GAYE, tax & NIC

8 Value Added Tax VAT MAY BE IN SECTION A IN BOTH PAPERS IN 2017 With respect to the syllabus, there isn t really anything very new in VAT other than the usual annual changes. Candidates simply need to grasp the basics! General principles and administration, registration/ deregistration Basis of accounting & schemes Treatment of Bad debts/discounts/ Entertainment/Private use/fuel/gifts, partial exemption VAT responses were better in 2016 but some confusion remained (income tax vs. VAT, what constitutes inputs or outputs? Could examine this topic as a short-form style question or as a more structured, step-by-step question (e.g. autumn 2016).

9 Main Areas for Concern Simple lack of preparation / grasp of the basics Not showing workings, untidiness, impenetrable answers Narrative answers articulation is often NOT what you would expect of an accounting technician & this remains an issue Strategy/Exam management time etc. Adjusted Profits layout & approach Adjusting PA in an income tax computation confusion with tax codes?! Adherence to structured course of study reputable provider, manuals, on-line learning, past papers, examiners reports, sample papers

10 Examiners Report Covers points on previous slides in more detail Students simply cannot ignore entire areas of the syllabus or types of question PERHAPS NOT WITH THE POSSIBILITY OF VAT ONCE AGAIN APPEARING IN SECTION A IN 2017! A number of very ill-prepared students still present for the exam & clear dichotomy between good (prepared) & bad (unprepared) exam candidates In the main though a lot of excellent candidates who obtain commendable exam results!

11 Exam Format 3/3 in Section A 2/3 in section B no guaranteed emphasis on topics in either section (any question is examinable in sections A or B ) Continued lesser/no emphasis on Revenue forms (P11, VAT100 etc.) Will continue to mix in narrative elements to traditional computational questions (E.g. PAYE) Will continue with short-form question(s) Will continue to extend this to the VAT question Will continue to examine the breadth of the syllabus

12 Questions Any Questions?