Unofficial practice for the ACCA Advanced Taxation (ATX-UK) exam. Not affiliated with or endorsed by ACCA.
Timed practice exam
Advanced Taxation practice exam 1
The whole exam in its structure: 3 written questions, 100 marks in 3 hours 15 minutes. Section A: question 1 (50 marks). Section B: questions 2 and 3, 25 marks each.
Question 1 carries 5 ethics marks and 10 professional skills marks; questions 2 and 3 carry 5 professional skills marks each, on the criteria each question states.
Check each figure as you enter it, and ask Mia to read each written part. She says which points your answer makes and what to add, with no mark, so the paper gives no pass or fail.
When the clock reaches zero the desk locks and the result opens. You can also hand in early.
Unofficial practice with original questions, written to the structure of the ACCA Advanced Taxation exam.
Tax rates and allowances
The supplementary instructions and the tax rates and allowances, as the exam provides them (Finance Act 2025).
You should assume that the tax rates and allowances for the tax year 2025/26 and for the financial year to 31 March 2026 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.
Income tax
Normal rates
Dividend rates
Basic rate
£1 – £37,700
20%
8·75%
Higher rate
£37,701 – £125,140
40%
33·75%
Additional rate
£125,141 and over
45%
39·35%
Savings income nil rate band – Basic rate taxpayers
£1,000
Savings income nil rate band – Higher rate taxpayers
£500
Dividend nil rate band
£500
A starting rate of 0% applies to savings income where it falls within the first £5,000 of taxable income.
Personal allowance
£
Personal allowance
12,570
Transferable amount
1,260
Income limit
100,000
Where adjusted net income is £125,140 or more, the personal allowance is reduced to zero.
Residence status
Days in UK
Previously resident
Not previously resident
Less than 16
Automatically not resident
Automatically not resident
16 to 45
Resident if 4 UK ties (or more)
Automatically not resident
46 to 90
Resident if 3 UK ties (or more)
Resident if 4 UK ties
91 to 120
Resident if 2 UK ties (or more)
Resident if 3 UK ties (or more)
121 to 182
Resident if 1 UK tie (or more)
Resident if 2 UK ties (or more)
183 or more
Automatically resident
Automatically resident
Car benefit percentage
The relevant base level of CO2 emissions is 55 grams per kilometre.
The percentage rates applying to petrol cars (and diesel cars meeting the RDE2 standard) with CO2 emissions up to this level are:
51 grams to 54 grams per kilometre
16%
55 grams per kilometre
17%
The percentage for electric cars with zero CO2 emissions is 3%.
For hybrid-electric cars with CO2 emissions between 1 and 50 grams per kilometre, the electric range of the car is relevant:
130 miles or more
3%
70 to 129 miles
6%
40 to 69 miles
9%
30 to 39 miles
13%
Less than 30 miles
15%
Car fuel benefit
The base figure for calculating the car fuel benefit is £28,200.
Company van benefits
The company van benefit scale charge is £4,020, and the van fuel benefit is £769.
Vans producing zero CO2 emissions have a 0% benefit.
Individual savings accounts (ISAs)
The overall investment limit is £20,000.
Rent-a-room relief
The rent-a-room relief limit is £7,500.
Pension scheme limits
Annual allowance 2022/23
£40,000
2023/24 to 2025/26
£60,000
Minimum allowance
£10,000
Threshold income limit
£200,000
Income limit
£260,000
The maximum contribution which can qualify for tax relief without any earnings is £3,600.
Approved mileage allowances: cars
Up to 10,000 miles
45p
Over 10,000 miles
25p
Capital allowances: rates of allowance
Plant and machinery
Main pool
18%
Special rate pool
6%
Cars
New cars with zero CO2 emissions
100%
Second-hand cars with zero CO2 emissions
18%
CO2 emissions between 1 and 50 grams per kilometre
18%
CO2 emissions over 50 grams per kilometre
6%
Annual investment allowance
Rate of allowance
100%
Expenditure limit
£1,000,000
Enhanced capital allowances for companies
Main pool first year allowance
100%
Special rate pool first year allowance
50%
Structures and buildings allowance
Straight line allowance
3%
Cap on income tax reliefs
Unless otherwise restricted, reliefs are capped at the higher of £50,000 or 25% of income.
Corporation tax
Financial year
2023
2024
2025
Small profits rate
19%
19%
19%
Main rate
25%
25%
25%
Lower limit
£50,000
£50,000
£50,000
Upper limit
£250,000
£250,000
£250,000
Standard fraction
3/200
3/200
3/200
Marginal relief
(Upper limit – augmented profits) x standard fraction x taxable total profits / augmented profits
Quarterly instalments
Profit threshold
£1,500,000
Value added tax (VAT)
Standard rate
20%
Registration limit
£90,000
Deregistration limit
£88,000
Penalties for late VAT payments
Days late
Penalty
Up to 15 days
None
16 to 30 days
3%
More than 30 days
6% plus a daily penalty at an annual rate of 10%
Inheritance tax: nil rate bands and tax rates
Nil rate band
£325,000
Residence nil rate band
£175,000
Rate of tax on excess over nil rate band – Lifetime rate
20%
– Death rate
40%
Inheritance tax: taper relief
Years before death
Percentage reduction
More than 3 but less than 4 years
20%
More than 4 but less than 5 years
40%
More than 5 but less than 6 years
60%
More than 6 but less than 7 years
80%
Capital gains tax: tax rates
Lower rate
18%
Higher rate
24%
Annual exempt amount
£3,000
Capital gains tax: business asset disposal relief and investors’ relief