Passing the Advanced Taxation - United Kingdom (ATX (UK)) exam

This article sets out the two issues which are relevant to success in the ATX (UK) exam: technical knowledge and exam technique.

Technical knowledge

You must know your stuff.

• Successful candidates are able to demonstrate sufficient, precise knowledge of the UK tax system.
• This includes knowledge brought forward from the TX (UK) syllabus.

The following technical articles are available to support you in your studies.

Taxation generally

‘Exam technique and fundamental technical issues for ATX (UK)’
Outlines two important aspects of examination technique and a number of fundamental technical areas which need to be mastered. This article is relevant to students who are beginning their studies and also those for whom the exam is imminent.

Income tax

‘Taxation of the unincorporated business – the new business’
Covers some of the issues relating to a new business including the choice of business vehicle and the first years of trading. This is not an introductory article; it is relevant to students coming to the end of their studies and finalising their preparations to sit the exam.

‘Taxation of the unincorporated business – the existing business’
Covers some of the issues relating to the extraction of profits from a business, change of accounting date and the final years of a business. This is not an introductory article; it is relevant to students coming to the end of their studies and finalising their preparations to sit the exam.

‘International aspects of personal taxation’
Begins with some basic rules, an understanding of which enables the particular areas of tax affected by an individual coming to, or leaving, the UK to be identified.  It then goes on to review those areas in some detail, and provides a clear set of questions to ask in order to determine an individual’s liability to UK taxes.  Finally, it deals briefly with the impact of double tax relief and treaties.

Capital taxes and trusts

‘Inheritance tax and capital gains tax’
Relevant to students coming to the end of their studies and finalising their preparations to sit the exam.  It examines the position where both taxes are relevant to a transaction and illustrates some of the matters that need to be considered when giving advice in the context of the ATX (UK) exam. It does not include comprehensive explanations of the two taxes but assumes a reasonable knowledge of the rules.

‘Trusts and tax’
Sets out the rules that may be examined and those areas where knowledge is not required. Considers the various types of trust and the capital gains tax and inheritance tax implications of transferring assets to a trust and property passing absolutely to beneficiaries.

Corporation tax

‘Corporation tax’
Concerns the taxation of a company as it begins trading, acquires an additional business, and eventually invests overseas.  It sets out the commercial decisions taken by the company and its shareholders at the different stages in the company’s development and summarises the tax implications of those decisions.

‘Corporation tax – Group relief’
Principally concerned with group relief. This is not an introductory article; it is relevant to students coming to the end of their studies and finalising their preparations to sit the exam.  It begins by briefly summarising the rules relating to both group relief groups and capital gains groups.  It then goes on to consider a number of group relief tax planning issues that could be introduced in an exam question.  It does not include comprehensive explanations of the rules but assumes a reasonable knowledge.

‘Corporation tax – Groups and chargeable gains’
Principally concerned with capital gains groups. This is not an introductory article; it is relevant to students coming to the end of their studies and finalising their preparations to sit the exam. It begins by briefly summarising the rules relating to both group relief groups and capital gains groups. It then goes on to consider various issues relating to capital gains groups that could be introduced in an exam question. It does not include comprehensive explanations of the rules but assumes a reasonable knowledge.

Exam technique

Candidates who perform well in the exam have clearly practised questions from past exams. By doing so, they have become familiar with what to expect in the exam in terms of the style and content of the questions. This is particularly relevant to the often more intellectually demanding Section A style questions. The candidates who have practised past exam questions also improve their ability to adopt the style of the model answers, such that their answers are specific, direct and concise.

Successful candidates take care to focus their efforts on the requirements of the question.

• You must read the requirement carefully – in the Section A questions the detailed tasks that you are to perform will be set out in one of the documents.  It may be helpful to tick off the tasks as you address them. Marks are awarded for satisfying the requirements and not for other information even if it is technically correct.
• The requirements of each question are carefully worded in order to provide you with guidance as regards the style and content of your answers.  You should note the command words (calculate, explain, etc), any matters which are not to be covered, and the precise issues you have been asked to address.
• You should also note any guidance given in the question or in any notes following the requirement regarding the approach you should take when answering the question. 
• Pay attention to the number of marks available – this provides you with a clear indication of the amount of time you should spend on each question part.

Successful candidates do not provide general explanations or long introductions.

• If you are asked to calculate, there is no need to explain what you are going to do before you do it; just get on with it – only provide explanations when you are asked to.
• Think before you write. Then write whatever is necessary to satisfy the requirement.
• Apply your knowledge to the facts by reference to the requirement.

Successful candidates think before they start writing and manage their time throughout the exam.

• Ensure that you allow the correct amount of time for each question.
• Before you start writing, think about the issues and identify all of the points you intend to address and/or any strategy you intend to adopt to satisfy the requirement.

The following non-technical articles are available to help you improve your performance in the exam.

• ‘Examiner’s approach to Advanced Taxation - United Kingdom (ATX (UK))’, which explains the structure of the Advanced Taxation - United Kingdom (ATX (UK)) exam and the skills required of candidates.
• ‘Stepping up from Taxation - United Kingdom (TX (UK)) to Advanced Taxation - United Kingdom (ATX (UK))’, which provides guidance on the progression from TX (UK) to ATX (UK) in terms of the syllabus, the style and format of the exam, and the approach necessary to maximise your chance of success.
• ‘Guidance on answering Section A questions in Advanced Taxation - United Kingdom (ATX (UK))’, which provides detailed guidance on the approach to be taken when answering Section A questions.
• ‘Improving your performance in Advanced Taxation - United Kingdom (ATX (UK))’, a series of five articles which provide detailed guidance on various aspects of exam technique.

Re-sitting the exam

If you are preparing to re-sit the exam, you should think about the number of additional marks you need and identify a strategy to earn them.  For example:

• Identify those areas of the syllabus where you are weakest and work to improve your knowledge in those areas. This should include any technical areas brought forward from TX (UK) where necessary.
• Practise past exam questions in order to familiarise yourself with the style of questions that you will have to deal with.
• Ask yourself whether you could improve the way you manage your time in the exam and whether you address all of the parts of all four questions or whether you waste time addressing issues which have not been asked for.
• Make sure that you earn the professional skills marks and that you are prepared to address the ethical issues which may be examined.

Written by a member of the ATX (UK) examining team