TOMMY AND JOHNNY MOCK EXAM 20 QUESTIONS 60 MINUTES

Complete the statement below

Policy 4 is payable to Jill. The value to be included for estate duty purposes

In the event that John does sell his valuable items should a reasonable price be obtained, the transaction will attract capital gains tax.

Is this statement true or false.

Match the statements below with regards to the R500 000 gift from Tom to John which is provided for in the ANC contract

John enquired from the executor the differences, if any, on the values for estate duty were the executor to sell the farm instead of it being passed on to John if, one assumes that the farm would be sold at its current market value.

The executor responds as follows: Select the correct statement

Complete the statement below:

In the event that the Bloemfontein residence is sold and, that John decides to move into the Cape Town holiday home, the capital gain made on the sale is:

Match the statements with the amounts below

If one assumes that the executor is happy to charge executor fees on the discounted value of the farm (ie only the 70% portion), he may do as he wishes. Is this statement correct or incorrect

Complete the statement below:

The executor fees that he can charge on the Holland apartment is:

The executor would like to invest R20 000 into the Tax Free Savings Account to take advantage of the tax free growth. The estate has not as yet been wound up and there has been no contribution to the tax free savings account in the current year of assessment. The executor would also like to transfer this investment to John as a result of a re-distribution agreement.  Select the most correct statement below with regards to this transaction:

TFSA = TAX FREE SAVINGS ACCOUNT

The net estate value in the calculation of estate duty is: 

Select the correct amount

Match the statements below:

The farm was bequeathed to the spouse which means that, for capital gain, the spouse will inherit:

Select the correct option below

If one had to assume that they decided to move from the Bloemfontein primary residence and move into the Cape Town holiday home as their new primary residence.

Further assume that they only manage to sell the Bloemfontein residence 8 months later, do they lose their primary residence exclusion as a result of the time lapse?

Select the correct statement.

The provisions available to settle a liquidity shortfall is: (before the sale of the Holland apartment)

a.    Policy 3

b.    Tax free savings account

c.    Bank account

d.   Endowment policy

The liquidity shortfall is : select the correct answer

If one assumes that Tom had sold the Holland Apartment while he was alive and, brought the funds back into South Africa which he invested in his money market account, would it be correct to say that the funds in the money market account would remain a deduction for estate duty considering that it is a ”replacement” of the inheritance received from a non resident.

Select the correct statement: