ACCA ATX study guide
ACCA ATX · Work through your exam, one topic at a time.
ACCA Advanced Taxation (ATX) is the advanced-level tax examination within the ACCA Qualification, taken by candidates who want tax to be their specialism rather than a subject they merely passed at an earlier level. It suits people already working in tax compliance or advisory roles - in practice, in industry, or in a finance function with a tax remit - who need to move beyond computation and give commercial, ethically sound advice to individuals, companies and groups. The ACCA ATX study guide has 7 sections and about 2,249 words.
01The UK tax system and its administration
Tax law comes from statute (the Taxes Acts, amended annually by a Finance Act), case law and HMRC guidance. The tax year runs 6 April to 5 April, and ATX questions almost always hinge on a date, so ask 'which tax year?' before calculating.
370 words, about 2 min02Income tax, national insurance and capital gains tax
Build the computation in a fixed order: trading income, employment income, property income, then savings income, then dividends. Deduct reliefs such as trading losses and gross pension contributions, then the personal allowance (£12,570, tapered by £1 for every £2 of adjusted net income above £100,000), then apply the basic, higher and additional rate bands.
321 words, about 2 min03Inheritance tax
IHT is charged on transfers of value, measured by the fall in the estate. Lifetime gifts are PETs or LCTs (chargeable transfers, for example into most trusts, taxed at 20% on the excess over the nil rate band).
334 words, about 2 min04Corporation tax
Corporation tax is charged on trading profits, property income, non-trading loan relationships and chargeable gains, computed under accounting principles and then adjusted for tax (disallowables such as depreciation and business entertaining; capital allowances instead). The main rate is 25% above £250,000 of augmented profits, 19% below £50,000, with marginal relief between, giving an effective 26.5% on the slice.
302 words, about 2 min05Value added tax and other indirect taxes
VAT is charged on taxable supplies (standard 20%, reduced 5%, zero 0%) made by a taxable person in the course or furtherance of business. Registration is compulsory once taxable turnover exceeds £90,000 in any rolling 12 months (backward look) or is expected to exceed it in the next 30 days (forward look).
322 words, about 2 min06Overseas aspects of taxation
Residence is determined by the statutory residence test: automatic non-residence (fewer than 16 days, or fewer than 46 with no historical ties), automatic residence (183 days), then the sufficient ties test. Domicile is a general law concept; deemed domicile applies after 15 of the previous 20 tax years, or where the individual was born in the UK with a UK domicile of origin.
307 words, about 2 min07Tax planning, ethics and the impact of taxes on decision making
Evasion is illegal (fraud or non-disclosure); avoidance is legal but targets the letter of the law. The general anti-abuse rule counteracts abusive arrangements, using a double-reasonableness test, with a 60% penalty where it applies.
293 words, about 1 min