The aim of Advanced Taxation – UK (ATX–UK) is to ensure that candidates can provide clients – both individuals and businesses – with the information and advice they require regarding the impact of the major UK taxes on their financial decisions and situations. The emphasis is on the practical application of tax rules to given client scenarios, and the production of helpful, clear advice.

Candidates are expected to be able to identify tax-related issues within scenarios, as well as demonstrate detailed knowledge of the tax system. In line with this emphasis on practicality, questions may require candidates to address ‘the UK tax implications’ of a given situation, without indicating which particular taxes to consider. It will be up to candidates to identify the relevant taxes, and the issues in respect of those taxes, before beginning to construct their answers. 

Candidates will also be expected to identify tax planning measures in order to minimise and/or defer tax liabilities. Such advice may be as simple as changing the timing of a transaction.

Calculations will often be required in support of explanations and advice. It will be up to candidates to decide which calculations to produce in order to do this in the most efficient manner. Advice on how to approach a given requirement may be provided in the question (for an example, see question 1, requirement (b)(i), of the ATX–UK specimen exam, applicable from June 2023 onwards).

The syllabus

ATX–UK is directly underpinned by TX–UK, Taxation–UK. Knowledge and understanding of the technical content of TX–UK is therefore vital if candidates are to be successful at ATX–UK. It is quite possible that the technical content of an ATX–UK question could be drawn almost wholly from the TX–UK syllabus. However, an ATX–UK candidate will be expected to demonstrate a higher level of application in relation to this knowledge than a TX–UK candidate would. In addition, knowledge which is asked for directly in a TX–UK exam, may be a less obvious part of a requirement in an ATX-UK exam, requiring candidates to recognise that the knowledge is required at this higher level, without being explicitly told. Therefore, ATX level question practice is a vital part of preparation for the ATX–UK exam.

The ATX–UK syllabus extends the coverage of income tax, corporation tax, capital gains tax and inheritance tax, as well as introducing stamp taxes. The syllabus is wider than that of TX–UK, as befits an option exam at the Strategic Professional level. New technical content is clearly identified in the Syllabus and Study Guide and candidates should expect this to be examined regularly. A Finance Act article is produced each year to guide candidates on the changes impacting each exam year (June – March) and it is important that candidates read this, ideally before they begin their studies.

Whilst no part of the syllabus is more important than any other, it should be recognised from the above that knowledge of the new areas introduced in ATX–UK will not, on its own, be sufficient to pass the exam. ATX–UK builds on TX–UK and, therefore, candidates must have a sound understanding of the technical content of TX–UK in order to be successful.

The technical areas included within the syllabus are set out in the Syllabus and Study Guide. The commands used in that document (for example, ‘identify’, ‘advise’, ‘recognise’, ‘determine’) are indicative of the broad intellectual level at which a particular area may be examined and should not be regarded as being in any way exclusive.

Every section A of an ATX–UK exam will include an ethical component for five marks. Questions on ethics are likely to examine the following areas: prospective clients, conflicts of interest, disclosure of information to HM Revenue & Customs (HMRC), money laundering, tax irregularities, tax avoidance, and tax evasion.

The structure of the exam

The exam consists of two sections; A and B. The whole of the syllabus is examinable in either section. All questions are compulsory.

Section A comprises question 1, which is worth 50 marks. This question will require the analysis of information provided and the use of any guidance given to help address the requirements. It will address a number of different taxes and is likely to test both personal and corporate aspects of taxation.

There will be 10 marks available in the question in respect of professional skills. These marks will be awarded to those candidates who demonstrate skill across the four professional skills: communication, analysis and evaluation, scepticism and commercial acumen. The professional skills are expected to be evident in the technical points candidates make, and are not marks which need to be earned separately. Those who follow instructions, answer the requirement set and produce relevant, specific answers which provide logical, coherent advice will score well. Candidates should refer to separate guidance on what these skills entail and how best to demonstrate them in the context of the ATX–UK exam.

In relation to the professional skills marks available for communication, question 1 will require the answer to be presented in a particular format – for example, a report, memorandum or letter. In some cases, more than one format will be required. It should be noted that the ability to communicate with clients, HMRC, and with other professionals, is also one of the five main capabilities required of candidates sitting ATX-UK, as set out in the Syllabus and Study Guide.

For question 1, the detailed requirements and the mark allocation for each requirement are contained within the ‘Work to be carried out’ exhibit. The instruction in the requirement window itself will simply say something like ‘Respond to the instructions in the email from your manager’, followed by clear guidance to refer to the ‘Work to be carried out’ exhibit. 

As question 1 represents 50% of the exam, careful time management will be important, and candidates are advised to use the number of marks allocated to each requirement to determine how much time to spend on each. Note that the requirement in, for example, question 1 of the ATX–UK specimen exam, applicable from June 2023 onwards, divides the meeting notes into four main sections, enabling candidates to focus their efforts as efficiently as possible.

Question 1 may include a large number of individual requirements, which may be broken down into further sub-requirements, as shown in question 1 of the ATX–UK specimen exam, applicable from June 2023 onwards. This is done to guide candidates on how best to address the requirements to score well. Candidates should attempt to answer all individual requirements, rather than just addressing a few in great detail.

Section B of each ATX–UK exam comprises questions 2 and 3, which are worth 25 marks each. Candidates are required to answer both questions. These questions will contain concise, structured information, divided up by sub-headings and bullet points, to make them easier for candidates to assimilate and navigate when compared with question 1.

There will be five marks available in respect of professional skills for each of the section B questions. The section B questions will examine a combination of analysis and evaluation, scepticism, and commercial acumen (ie not communication) as appropriate to the scenario. Communication is only examined in section A.

Unlike question 1, the detailed requirements and mark allocation for the section B questions are contained within the requirement window.

Past exams

It should be noted that the structure of the exam from June 2023 onwards, as set out above, differs from the exams set prior to this, up to and including March 2023. The way in which professional skills are tested has also changed significantly.

Candidates should consider this if using older past exam materials to prepare for the ATX–UK exam. The technical content of past questions remains very useful, assuming it has been appropriately updated to reflect the relevant Finance Act under which your exam will be set. However, candidates should always consider the format and structure of the current ATX–UK exams which they will attempt, and ensure they use the specimen exam and practice questions produced by ACCA which are available on the Practice Platform. In addition, study content is available on the ACCA Study Hub via a student MyACCA account, as well as the materials which are available from BPP Learning Media and Kaplan Publishing, ACCA's content partners.

Nevertheless, the past exams give a clear indication of the difference in style between the questions in the two sections.

Candidates’ approach in the exam

It is important that candidates think before they start to type an answer in order to identify the relevant issues, and the calculations necessary, to support their answer. In addition, they should consider whether the necessary calculations could be carried out in a particularly efficient way. For example, it may be that the client will be a higher rate taxpayer regardless of the particular strategy chosen, such that the income tax implications can be computed at the margin without the need to prepare full income tax computations. Similarly, candidates should try to avoid producing detailed pro forma calculations (for example, of capital allowances), when a simpler working will provide the figure required.

Candidates should also consider which of the available response options (i.e. word processing and/or spreadsheet) are the most appropriate for their answers. This will be a personal choice, which may depend on the nature of the question. Candidates should practise answering questions using the CBE functionality to determine the approach which is best suited to them, enabling them to answer the questions effectively.

For example, simple calculations in support of an explanation may be more easily presented within the word processing response option, whereas a more complex calculation with multiple stages may be better suited to the spreadsheet response option so that the spreadsheet functionality can be used effectively. Regardless of which response option is used, calculations should be clearly labelled and cross-referenced, if necessary, and all workings should be clear.

Whilst constructing an answer, candidates must always remember what the purpose of the document is – for example, a client communication or a firm's files – and try to make their answer concise, practical, relevant, and helpful.

Written by a member of the ATX–UK examining team