Accounting for undistributed income

Which of the following is the definition of a 'close company'?

A small-to-medium sized enterprise

A small company

A company under the control of five or fewer participators

A family company

What can section 441 impose?

A surcharge

A rule stating that you may only distribute income after 18 months

Tight rules about distributing income

Tight rules about the definition of professional and non-professional services

Where does the surcharge not apply?

Where firms are using junior staff to provide professional services

Where firms are providing only professional services

Where firms distribute their profits after 18 months

Where the principal part of the income of a company is not derived from surchargeable activities

At what rate does the surcharge apply?

15 percent of the surchargeable income is subject to a surcharge at 50 percent

15 percent

50 percent of the surchargeable income is subject to a surcharge at 15 percent

50 percent

What is the 'principal part' of a company's income?

Greater than a third of gross fee income

Greater than 45 percent of gross fee income

Any income made in a financial year

Greater than 50 percent of gross fee income

Which companies are most likely to be subject to the surcharge?

Companies carrying out a significant amount of audit and financial statement preparation

Companies making a large amount of money

Accountancy companies

Auditors

On what did the Commissioner rely when deciding what fell within the definition of professional services?

A single legal case

Regulatory body guidance

Legal precedent

Government advice

What did the firm in the case outlined contend were non-professional services?

Bookkeeping

Any work done by junior staff

VAT and preparatory work

Bookkeeping, VAT, and preparatory work undertaken by junior staff

What are the two relevant parts of CIR v Maxse in the case before the Tax Appeal Commissioner?

The definition of 'profession' and whether non-qualified accountants are professionals

The definition of 'profession' and whether professionals can carry out non-professional work

The division between professional and non-professional work, and the definition of 'profession'

The definition of 'profession' and the level of skill required to meet it

Which of the following most closely reflects the Commissioner's decision in this case?

The Commissioner gave the firm a warning

The Commissioner backdated the surcharge

The Commissioner refused the appeal and ruled that junior staff can carry out professional work

The Commissioner fined the firm

Accounting for undistributed income

Which of the following is the definition of a 'close company'?

What can section 441 impose?

Where does the surcharge not apply?

At what rate does the surcharge apply?

What is the 'principal part' of a company's income?

Which companies are most likely to be subject to the surcharge?

On what did the Commissioner rely when deciding what fell within the definition of professional services?

What did the firm in the case outlined contend were non-professional services?

What are the two relevant parts of CIR v Maxse in the case before the Tax Appeal Commissioner?

Which of the following most closely reflects the Commissioner's decision in this case?

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