AAFM Exam CWM_LEVEL_2 Topic 4 Question 88 Discussion

Actual exam question for AAFM's CWM_LEVEL_2 exam

Question #: 88
Topic #: 4

Section B (2 Mark)

In the year to 31 March 2012, a UK resident company made a UK trading profit of 800,000 and received net overseas income of 26,000 (net of 20% withholding tax). These were the company's only sources of income. The company also paid a qualifying charitable donation of 5,000.

For double tax relief purposes, the charitable donation will be allocated as a deduction from the company's overseas income. True or False?

ATRUE

BFALSE

Show Suggested Answer

Suggested Answer: C

by Malcom at Sep 12, 2024, 10:25 PM

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Candida

6 days ago

Well, the question specifically says the donation will be allocated to the overseas income for double tax relief purposes, so I'm going to go with TRUE on this one.

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Krystal

13 days ago

But the charitable donation is allocated as a deduction from the company's overseas income, so it should be True.

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Margurite

15 days ago

Hmm, this seems like a tricky one. If the charitable donation is allocated as a deduction from the overseas income, that would reduce the amount of income subject to double tax relief. Gotta think this through carefully.

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Marleen

2 days ago

A) TRUE

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Cordelia

17 days ago

I disagree, I believe the answer is False.

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Krystal

22 days ago

I think the answer is True.

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