This article is targeted at candidates preparing for the ATX-MYS, Advanced Taxation exam. This article provides guidance on the new format of the exam applicable from December 2023, and some advice on good exam technique and best exam practice.
Although this article is about exam technique as opposed to technical knowledge, it must be emphasised that you will not be able to pass the exam on the basis of good exam technique alone. Strong technical knowledge across the whole of the syllabus is vital for success in the ATX-MYS exam.
There is more guidance on exam technique in the examiner’s report published after each exam session.
From December 2023, the exam will consist of three questions, rather than four. Section A will comprise one 50-mark question, which will include 10 professional skills marks. Each Section B question will be worth 25 marks, including 5 professional skills marks. The whole of the syllabus is examinable throughout both sections of the exam.
As you may already be aware, there are currently 4 professional skills marks in the ATX exam, focused on presentation and problem solving. What is being introduced is a development of these marks to provide students with more credit for demonstrating professional skills. The four professional skills that will be assessed in ATX are communication, analysis and evaluation, scepticism and commercial acumen.
All four skills will be assessed in Section A. Communication is only examined in Section A as this is where a specific format for the answer is requested. For example, in ATX this could be meeting notes, a letter or a memorandum for the client files, etc.
The Section B questions will examine a combination of analysis and evaluation, scepticism and commercial acumen, with at least two skills being examined in each question. The combination of professional skills examined in the Section B questions will depend on the scenario and requirements given – there will not necessarily be an even split of marks across the skills being tested.
It should be stressed that this does not represent a change to the technical substance of the exam. The professional skills marks are not earned separately, instead they are awarded by reference to the technical work candidates do. The ATX-MYS examining team will be looking for these professional skills to be evident in the technical points candidates make. There is no need to address the professional skills separately when answering a question.
Candidates should therefore treat the exam as being out of 80 (as opposed to 100) marks, such that they will have just over 2.4 minutes per mark. When compared with the previous format of the exam, this change in format is intended to allow candidates more time to think about the requirement, what they want to say, and how they want to say it.
Candidates should remember that the single question in Section A is important because, from December 2023, it represents 50% of the marks in the exam. So, question 1 is now for 50 marks (rather than 35 marks) and, as mentioned, will include 10 professional skills marks. The 40 technical marks will always include 5 marks in respect of ethics. This has been a feature of each ATX-UK exam for some time, and this will now be the case for the ATX variant exams as well.
Questions 2 and 3, in Section B, will be for 25 marks each, including 5 professional skills marks. Ethics will not be examined in Section B.
To illustrate the changes in format, the mandatory ethics requirement, and the increased professional skills marks, candidates should refer to the new, full specimen exam available on the Practice Platform.
Candidates should also refer to ACCA’s article, Ethics questions in the ATX exams, for further guidance on how to approach the ethics requirement in question 1.
In the ATX-MYS exam, marks are awarded for satisfying the question requirements and not for other information provided, regardless of how well written or technically accurate it may be. Accordingly, it is vitally important for exam success to be able to identify and then address the requirements of the question.
In light of this, some techniques to bear in mind when responding to questions during the exam have been compiled, which should assist candidates to maximise their marks in the ATX-MYS exam.
1. Read the requirement
Candidates are urged to read the requirements carefully. Underline the key words and pay attention to the verb used in the requirement:
List
Explain
State
State, with reasons
Determine
Compare
Analyse
Conclude
Calculate
For example, ‘explain’ requires you to give reasons for your statements, whereas ‘state’ (on its own) does not. Explaining tax implications is often not easy and candidates should practise this to ensure that they are able to make their point in a sufficiently precise manner, in the time available.
If a question requirement asks candidates to ‘calculate’, this generally does not require explanations, although the requirements may ask you to provide supporting explanations in respect of certain aspects of the calculation.
2. Apply your knowledge to the scenario
It is important at the ATX level that candidates are able to apply their technical knowledge to the scenario provided rather than regurgitating all of the facts they have learnt or recalled on a particular technical area. Your answer should focus on the specific facts on the question rather than generalising.
For example, if a question asked whether withholding tax is applicable in a given scenario, a satisfactory answer should consider the nature of the payment; is it an interest payment, royalty payment, technical fees or other income? Furthermore, is the payment derived in Malaysia? How is it derived in Malaysia? Is the recipient a resident or non-resident? If the question concerns an interest payment, then there are unlikely to be marks available to a candidate who writes at length about the withholding tax applicable on technical fees, however tempting this may be.
Furthermore, candidates should resist the temptation to provide unnecessary information, which is not asked for in the requirement. This is a waste of valuable time. To illustrate, in the withholding tax example above, it will not be automatically necessary to provide additional information such as ‘the payer must pay the tax withheld to the Director-General of Inland Revenue within one month and the penalty for late payment is 10% of the amount’.
3. Answer the question, rather than writing all you know about the topic
Try not to think of a question as being about a particular technical area as, if you do, you risk that you answer the question in too narrow a manner.
For example, if a requirement asks you to 'provide arguments for treating the gain as revenue or capital', try to resist the temptation to write an essay about the badges of trade.
A much better approach is to relate the facts given in the scenario and demonstrate how they satisfy the relevant badges of trade. This also links into technique 2 (above) about application of knowledge.
4. Show how conditions are fulfilled
Following on from the points above, it is generally insufficient to state the relevant law – candidates are then expected to demonstrate how any legislative conditions are satisfied (or not satisfied) by the taxpayer in the relevant scenario.
For example, if a requirement asks you to 'explain the requisite conditions for the incentive that are satisfied by the company', it is not sufficient to merely list the conditions for the incentive, but, rather, you should demonstrate how the company satisfies each condition.
5. Be specific
It is important at ATX-MYS that candidates’ knowledge is sufficiently precise to be able to answer the specific requirement. As noted above, it is important to resist the temptation to write generally about a technical topic as a requirement will rarely ask you to do this.
From a time perspective, it is important that you only address the requirement set. For example, if you are asked to explain the tax treatment of the Malaysian single-tier dividend, do not launch into an introductory paragraph on the different types of dividend, exempt account, exempt dividend, two-tier exempt dividend, transition from the imputation system, etc. This is not relevant to the requirement that is being set, which asked you to focus on the treatment of the single-tier dividend only.
6. Note the marks allocated
Be mindful of the marks allocated: it is an indication of how wide or how deep your answer should be (and the time you have to answer the requirement).
For example, if a question presents you with two situations and you are required to consider whether withholding tax is applicable in each of these different situations, it is important that you note the marks allocated to each of the respective requirements. If requirement (a) relates to the first situation and carries two marks, while requirement (b) relates to the second situation and carries five marks, this is an indication that requirement (b) requires more thinking through and more consideration while requirement (a) may relate to a more straightforward situation. It is important that you allocate your time accordingly and do not waste precious time providing a very lengthy answer to requirement (a) – remember, you cannot be awarded more than two marks for this part, however impressive your answer may be.
7. Use terms accurately
Part of the nature of tax is precision and attention to detail and it is consequently important that candidates sitting ATX-MYS are careful in their use of tax terminology such as exempt, allowable, deductible, interest restriction, etc.
To illustrate this point, below are listed some examples of imprecise use of tax terminology, which is frequently encountered in ATX-MYS candidate scripts:
It can be seen from all of the above examples that a failure to use tax terms accurately can change the sense of what the candidate has written and may render an answer technically incorrect.
8. Think before you write
Due to the complexity of the scenarios presented at the ATX level, it is important to think before you write. This thinking time gives you time to be clear on the facts of the scenario and what the requirements are asking you to do.
Thinking before you write should also help you avoid wasting time by writing about irrelevant matters that do not address the requirement set.
To look at this another way, if a tax client came into your office to request some advice, you would not quickly read through the presented documents and immediately present your advice. Rather, you would take some time to think through the implications and to fully understand the work the client requires you to do. The same logic applies in the ATX-MYS exam and, as mentioned, with the introduction of 20 professional skills marks, candidates are now able treat the exam as being out of 80 marks, allowing more thinking time per mark.
In light of the above exam techniques, some best practices have been compiled to increase the effectiveness of your preparation for the ATX-MYS exam. This list is not comprehensive but should present you with some useful suggestions to make use of in the course of your preparation for the exam.
1. Constantly improve your English
Read, listen, speak, practise and improve. Ensure you are comfortable with the relevant tax terms and how to use these. Practise answering the new specimen exam and past exam questions in the allocated time to ensure you are answering the requirement in a clear and coherent fashion – it is not as easy as you might think!
2. Do not memorise without understanding
If you understand or comprehend what you are learning, it is much easier to remember and recall (and to apply correctly in the exam!). If you do not understand a technical point, ask others: your peers, your lecturers, etc. This may spark a technical discussion where you learn a lot more than you would have reading by yourself.
3. Understand the rationale or the basis for the rules
Wherever applicable, learn about the rationale for certain rules or laws. It then becomes easier to remember them as they should make more sense.
4. Make short notes
Having read through and understood the reference materials, make short notes on cards. This will entrench or reinforce your understanding of the subject matter.
A good technique is to try and summarise a topic in your own words. Not only does this test whether you have understood the topic, but it also helps ensure you are able to express yourself clearly in English (see best practice point 1, above).
5. Share and learn
Form discussion groups with like-minded fellow students to benefit from peer-group learning. There should be unreserved sharing among group members of what each member understands. In sharing and vocalising what you have learned, you will remember better because you have processed the subject matter, understood it and expressed it in your own words. Therefore, in sharing, you are retaining. Often you may find that your fellow students each struggle with different areas of the syllabus. Perhaps you can help a fellow student on the area you are strongest on and receive assistance in return on an area you find more of a challenge.
Written by a member of the ATX-MYS examining team