Making tax digital. Whilst gathering the information in part A above you pause for a coffee and a chat. Over coffee Nicola talks about her future plans. As explained above she has a small consultancy business.  She explains that working for FP

NOTES:

1. The coursework accounts for 40% of the overall module mark. This coursework is in two sections you should answer all parts of both sections.

2. Your completed coursework should be uploaded through the Moodle website no later than 2pm. 21st November 2025. Do not submit a PDF file, submit only a Word document and related Excel calculations.

3. To ensure you receive timely feedback and stay on track with your studies, we strongly encourage you to submit your work before this deadline. Meeting deadlines is an important skill that demonstrates effective time management and planning, which is essential for success in your studies and future career.

4. If you are unable to meet the deadline, you may submit your work up to 7 days (5 working days) late without penalty. Please note that late submissions will be recorded and monitored. This submission link will close at 4pm on the 7th day following the submission deadline, after which no further submissions will be accepted.

5. If you are facing challenges that affect your ability to complete your assessment, it’s important to inform us and seek support. You can always speak to the Course Director to discuss academic issues you may also be eligible for an Extenuating Circumstances claim if you encounter unexpected difficulties (https://myaccount.lsbu.ac.uk/s/article/How-can-I-submit-an-EC-claim).”

6. To submit your coursework electronically you must upload your work to the esubmission portal on Moodle.

7. Multiple drafts can be submitted up to the submission date.

8. Please remember you must leave at least 24 hours between submissions if you make changes to your work. Each submission will overwrite the previous one until the due date and time has passed.
9. You are reminded of the University’s regulations on cheating and plagiarism. In submitting your assignment, you are acknowledging that you have read and
understood these regulations.

10. You are reminded that it is your responsibility to keep an electronic copy of your assignment for future reference.

11. Your citations need to follow the Harvard style referencing.

12. As the submission is anonymous please do not put your name of the submission.

Section A

Income tax computation – this section carries 50 marks

Nicola is 38 years old, married and has 2 children (twins).  She currently works as a consultant for “French Pier plc” (FP) a large engineering consultancy.   On 1^st April 2024 she was appointed as lead consultant on the rail systems installation on the HS2 project.  As the step up to Project Director has resulted in a significantly increased remuneration package Nicola would like to know what her 2024/25 tax liability will be, and she has asked for your help.  Nicola provides the following information.

The new annual salary is £YYYYMM/2* plus 3 project progress bonuses estimated at £15,000 each payable in March 2025, July 2025 and December 2025.  In April 2024 Nicola received a bonus of £8,000 in respect of a completed contract in February 2024.

*Note: You should use your year and month of birth and divide by 2.  For confidentially reasons please feel free to use another date within 3 years.

Nicola has been a member of the FP pension scheme since joining the company in 2018.  Under the scheme Nicola pays 6% of her salary into the fund.  FP also pay 6% of Nicola’s salary into the fund. The salary stated above is gross before any deductions.  Tax on the FP salary is deducted under PAYE and the P60 for the year to 5th April 2025 reveals that £47,500 tax has been deducted.

In recognition of the Project Director status French Pier have provided a revised benefits package as set out below.

Company cars:

• On 6^th July 2024 Nicola was given the use of a new Mercedes C300e Urban Edition Saloon for which FP paid £44,960 although the manufacturer’s list price was £51,460. Nicola tells you that this is a 2-litre hybrid vehicle and that she was told that relevant emission and mileage information is available on the Mercedes-Benz UK website. FP will pay all costs (including private fuel) which for the period to 5^th April 2025 are servicing £1,800, road tax £465, insurance £2,250 and fuel £1,950. Nicola kept a record of mileage and in the year to 5^th April 2025 Nicola drove 16,000 miles of which 75% were business miles.
• Prior to 6^th July 2024 FP provided Nicola with a petrol 1.6 Kia Sportage which had a P11D value of £29,470 and CO2 emissions of 108 g/km. Nicola paid for all petrol and claimed a fuel-only mileage rate of 16p. Mileage expense claims reveal that Nicola claimed 5,500 business miles. FP paid all servicing and running costs: road tax £195 (per annum), insurance £1,650 and servicing and repairs in the three-month period amounting to £975.

Hotel accommodation:

• During the year to 5^th April 2025 Nicola stayed in Birmingham near to the main construction offices although she also stayed at various locations along the HS2 route.

Hotels were usually of 4 star standard with gym facilities and a swimming pool. The cost to FP was £11,000 (50 nights at £220.00 per night).  You understand that if lower quality hotels had been used without a gym and swimming pool (eg Premier Inn!) then the total cost would have been around £6,500 (50 nights at £130.00).

• As a reward for working long hours and some weekends the Chairman of FP gave Nicola, her husband and two children an all expenses paid trip to Disneyworld in Florida. The total cost of the 8 day trip was £3,200 (including flights, full board hotel and car hire).  As the trip was in May 2024 (a particularly busy time) Nicola had to work for two of the days whilst away – looking at plans and some online meetings.
• As the project will become very intense and busy FP’s Projects Director arranged for

Nicola to stay in an apartment near the Birmingham construction office from 1 February

2025. The accommodation has an annual value of £8,000 and a market value of £380,000, FP will pay £1,500.00 per month rent. Other costs (council tax, service charge and utilities) amount to £250.00 per month. The apartment has furniture to the value of £8,200 and the official interest rate is 2.25%.

Equipment:

• FP have provided Nicola with an Apple MacBook Pro cost £1,600, Apple iPhone 16e £600,00, Apple iPad Pro £1,000 and a Canon EOS R10 digital camera £1,250. Although used for work FP have made it clear to Nicola that she is free to use all items for personal use and Nicola thinks that on average the personal use amounts to around 40%. All items except the camera have been available since 6^th April 2024.  The camera was made available on 6^th July 2024.
• Since 6^th July FP have provided Nicola (on a loan basis) a Sony home cinema system. The system cost £2,500.  Nicola makes no contribution to FP for the system.

Loan:

• On 6^th July FP loaned Nicola £36,000. She made no repayments in the year but she did pay interest of £320 to FP.

School fees:

• On 5^th January 2025 Nicola’s two children started at St Hilary’s (a private school in Surrey). FP will pay the school fees as the Chairman feels that this will help Nicola to focus on her projects. The per term fees are £5,345.00 for each of the two twins.  The fees are payable one week after the start of the term and Nicola contributes £1,000 for each child. Lunch costs and transport costs are in addition to the fees and are paid by Nicola.

During the year to 5th April 2025 Nicola paid to get some safety clothes for her work.  FP did provide them but they were too big and uncomfortable so Nicola bought a high vis jacket and some protective boots, these cost £125.  FP did say that they would reimburse these amounts if Nicola submitted a claim however she felt that the company had been very good to her and was reluctant to make a claim.

Nicola has a payroll giving arrangement (Give As You Earn) whereby 2% of her salary is deducted and given to Oxfam.

Nicola gives you additional relevant detail on her financial affairs:

Although very busy working for FP Nicola has a small freelance consultancy where she writes reports for insurance companies in claim cases which have to go to court.  She also writes technical articles for engineering magazines and journals. For the year to 31st March 2025 Nicola will have profits of £6,500.  Under the 2023/24 profit apportionment transition arrangements Nicola had transition profits (after overlap relief) of £8,500.

Nicola lives in a large house and for the last two years she has rented a room to the daughter of a friend who has a job at a local care home.  The daughter pays £600 a month and costs in relation to this are minimal – Nicola estimates that additional annual costs, mainly electricity, amount to £250.

During the year to 5^th April 2025 Nicola received £1,840 bank interest, £1,200 dividends from FP and £850 from an Individual Savings Account (ISA).  She also paid private pension premiums amounting to £18,000 (these are made net of tax at 20%) and made several additional charitable donations (British Heart Foundation, the St Hilary’s School Voluntary Fund and Battersea Dogs Home) amounting to £1,200.

Nicola receives child benefit allowance for her two children.  In 2024/25 she received £1,331 for one child and £881 for the other.

Required:

Based on the above information write a report to Nicola setting out her liability to Income Tax and National Insurance for the tax year to 5th April 2025.  Your report should explain the treatment of the various items.

(20 marks – 1,000 words)

You must clearly show all the relevant calculations in detail, added as supporting documents to your report. Your calculations should be set out in a way that Nicola (not an expert) can easily understand.  You should use and submit an Excel worksheet for your calculations.

(20 marks)

Remember! Nicola is an engineer, so she is good at maths and numbers, and does have some business/financial understanding but does not have much knowledge of taxation.  Therefore, you have to be very clear in your explanations and presentation.  You should reference any information sources, state any assumptions you make and identify any additional information you might need.

Professional marks will be awarded for:

• The overall presentation of the report.
• The provision of relevant advice
• The effectiveness with which information is communicated.

(10 marks)

In answering this question you should refer to LSBU’s policy on AI

https://library.lsbu.ac.uk/AI-academic-study

Total marks for section – 50

SECTION B

Part 1

Making tax digital.

Whilst gathering the information in part A above you pause for a coffee and a chat.

Over coffee Nicola talks about her future plans. As explained above she has a small consultancy business.  She explains that working for FP is great, they pay well but it’s hard work and full on, such that she has limited time for her family.  Her little girls are growing up and she feels that she is “missing seeing and celebrating changes as they get older”.  She tells you that once her work on the HS2 project is complete she is planning to leave FP and focus on her self-employed consultancy. She is confident that she can “grow the business”.

She goes on to tell you that she has heard about the HMRC making tax digital (MTD) project and wonders how it will affect her business going forward.

Required:

Write brief notes explaining the likely impact of MTD on Nicola’s business.

Present your detailed notes in a report format. (Calculations are not required for this question).

Your summary should be detailed enough to be understood by Nicola – a non-tax specialist. It may contain examples if that will improve the clarity of your report.

(15 marks – 1,000 words)

Part 2

The badges of trade.

During your discussions Nicola tells you that at one of the court cases she was helping out on there were various discussions “about something called the badges of trade. Can you tell me what they are and what they indicate?”.

Required:

Write notes explaining the badges of trade. You should support your explanations with relevant cases.

(15 marks – 500 words)

Part 3

Environmental issues.

As your meeting with Nicola continues she explains that she has become very concerned about the future, especially the global environment.  She tells you “it’s my two girls that I am most worried about.  If we don’t get the planet right it’s their generation that will suffer.  She then points to a quote attached to her fridge freezer.

“The climate crisis is both the easiest and hardest issue we have ever faced.  The easiest because we know what we must do. We must stop the emissions of greenhouse gases.  The hardest because our current economics are still totally dependent on burning fossil fuels, and thereby destroying ecosystems in order to create everlasting economic growth.

Greta Thunberg eco activist

And to another one on the notice board:

“I am telling you there is hope.  I have seen it, but it does not come from the governments or corporations. It comes from the people”

Greta Thunberg eco activist

Nicola goes on to ask “is that true, governments don’t do anything?”  Our UK government must be doing something?  I thought there were lots of green taxes?  Maybe we can discuss again when you come back with my tax calculations and report.

Required:

In advance of future discussions with Nicola write a brief set of notes identifying how the UK tax system seeks to reduce environmental damage and preserve the environment.

Note: this is a very large topic you should aim to summarise the key points.

(20 marks – 1,000 words)

Total marks for section 50

Marking guide for Finance for Taxation Practice Coursework

Participation number:

Assessment criteria

Taxation Practice Coursework 

1. SUBMISSION

This report has a 40% weighting in calculating your overall module mark.

It must be produced in a single Microsoft Word document and uploaded to Moodle Submission Inbox by   . You must keep a duplicate copy of all work submitted for assessment. You should submit a supporting Excel file of your workings. 2. Specific instruction relating to the coursework

(a) For your guidance – the report should include the following:

• Title/cover (including the name/number of the course, the name of the module and coursework, student number, the date and the word-count)
• Page of contents
• Main body of report (Parts one, two, three and four)
• Bibliography (using Harvard style of referencing)
• Appendices
• The attention of every student is drawn to the warning in the course guide on late submission of coursework, mitigating circumstances and plagiarism. For guidance on copyright and referencing see the following section ‘Guidance on referencing’.
• It should be noted that 10% of the marks are reserved for the quality of presentation as reflected by the bibliography, reference citations in text and cross-referencing.
• Ensure your entire answer is contained in one file only – upload that file to the Submission Inbox. You should upload a supplementary Excel file of workings but note this should only support appendices to your report.  You should also note that embedded links will not work.
• AI should be used with care and not to answer Part A. Where AI has been used to help

you, you should explain how it has been used in an appendix to the question.  You should follow the LSBU AI guidance.

Guidance on referencing 

(Supplied by Academic Misconduct Officer)

Correct referencing is an academic skill that you will be assessed on.

Correct referencing demonstrates that you have read appropriately on the subject, shows that you are acknowledging the sources you have used (that you are not trying to cheat) and provide information on useful sources of information to your reader.

Doing it correctly demonstrates professionalism. Doing it incorrectly will lead to reduced marks and possibly to disciplinary action, which includes the possibility of having your studies terminated.

I do see cases where the student has clearly deliberately attempted to cheat. These are dealt with very firmly. However, most cases I see are where students have either referenced poorly or not bothered with referencing at all. Good work often fails in these circumstances.

Guidance on referencing itself is available from the resources listed at the end of this sheet. If you have any concerns about your referencing ask for help before submitting.

Checking your referencing 

You are required to upload your coursework to the Advanced Personal Taxation Moodle site AFE_5_TAP_2526. Use this site for checking your work for matching text. This will reveal where you have not fully referenced. You will need to reference correctly or remove the matching text from your final submission. The matching source given by the check may not be the one that you used. Make sure you use the Library Help sheets to guide you on correct referencing (style: Harvard).

When you submit your coursework you must submit a copy of the latest matching Turnitin report.

The version to submit is the ‘Show highest matches first’ version (the one with numbers in the boxes) as this is the easiest for you to check your work. When you look at your report (use the ‘Show highest matches first’ version) you will see that there is a list of sources on the right that match (numbers in boxes) to the highlighted text on the left.

Remember, the point of this exercise is not to remove all matching text, but to make sure that it is properly referenced.

If you have a match of 1% or less, this will almost certainly be down to coincidence. LSBU are not concerned about matches of 1% or less. You do not have to do anything about these.

You need to look at all matches of above 2%. Where there is such material that is matching you must ensure it is referenced or remove it from your work