ATT Personal Tax Paper 1 Tax Reliefs and
Allowances 2026 – Association of Taxation
Technicians (ATT) Personal Taxation Practice
Exam 2026 | Practice Questions & Study Guide
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Detailed Answers & Rationales (Reliable
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Question 1
For the 2026/27 tax year, what is the standard Personal
Allowance available to an individual before considering any
restriction for high income?
A. £10,000
B. £11,310
C. £12,570
D. £13,500
Answer: C. £12,570
The standard Personal Allowance for 2026/27 is £12,570. It is
the amount of an individual's income that is generally free of
,income tax before considering special circumstances such as the
high-income restriction. The allowance remains at this level for
2026/27. It should not be confused with the basic-rate band,
which determines the rate at which taxable income is charged
rather than the amount of income initially exempted by the
Personal Allowance.
Question 2
An individual has adjusted net income of £118,000 for 2026/27.
What happens to the individual's Personal Allowance?
A. It remains £12,570
B. It is reduced by £9,000
C. It is reduced by £4,500
D. It is reduced to £10,000
Answer: B. It is reduced by £9,000
The Personal Allowance is reduced by £1 for every £2 of
adjusted net income above £100,000. The excess is £18,000, so
the reduction is £9,000. Therefore, assuming no other relevant
adjustments, the Personal Allowance becomes £3,570. The
important calculation is based on adjusted net income rather
than simply employment salary.
,Question 3
Which statement correctly describes the effect of a qualifying
Gift Aid donation on an individual's income-tax position?
A. It reduces taxable income directly by the amount donated.
B. It provides a deduction against capital gains.
C. It extends the basic-rate band by the grossed-up amount of
the donation.
D. It is ignored when determining the individual's income-tax
liability.
Answer: C. It extends the basic-rate band by the grossed-up
amount of the donation.
Gift Aid operates through tax relief given to the charity and an
extension of the individual's basic-rate band. A cash donation is
treated as having been made net of basic-rate tax.
Consequently, the donation is grossed up before determining
the amount by which the relevant income-tax band is extended.
This can allow more income to be taxed at lower rates and can
be particularly valuable to higher-rate taxpayers.
Question 4
An individual makes a qualifying Gift Aid donation of £8,000.
What is the gross amount treated as donated for income-tax
purposes?
, A. £8,000
B. £9,000
C. £10,000
D. £10,667
Answer: C. £10,000
Gift Aid donations are normally treated as being made after
deduction of basic-rate income tax. A £8,000 net donation is
therefore grossed up by dividing by 80%, giving £10,000. The
£2,000 difference represents the basic-rate tax deemed to have
been deducted. The grossed-up figure is the amount relevant
when extending the individual's tax bands.
Question 5
Which taxpayer is entitled to claim the Marriage Allowance,
assuming all other eligibility conditions are satisfied?
A. A higher-rate taxpayer transferring £1,260 to a basic-rate
spouse
B. A spouse or civil partner who is eligible to transfer part of
their unused Personal Allowance to a basic-rate spouse or civil
partner
C. An additional-rate taxpayer transferring part of their
Personal Allowance
D. Any taxpayer who is married, regardless of their tax rate
Allowances 2026 – Association of Taxation
Technicians (ATT) Personal Taxation Practice
Exam 2026 | Practice Questions & Study Guide
| Complete Exam-Style Questions with Correct
Detailed Answers & Rationales (Reliable
Answers) | Latest Updated Version | Instant
Download PDf
Question 1
For the 2026/27 tax year, what is the standard Personal
Allowance available to an individual before considering any
restriction for high income?
A. £10,000
B. £11,310
C. £12,570
D. £13,500
Answer: C. £12,570
The standard Personal Allowance for 2026/27 is £12,570. It is
the amount of an individual's income that is generally free of
,income tax before considering special circumstances such as the
high-income restriction. The allowance remains at this level for
2026/27. It should not be confused with the basic-rate band,
which determines the rate at which taxable income is charged
rather than the amount of income initially exempted by the
Personal Allowance.
Question 2
An individual has adjusted net income of £118,000 for 2026/27.
What happens to the individual's Personal Allowance?
A. It remains £12,570
B. It is reduced by £9,000
C. It is reduced by £4,500
D. It is reduced to £10,000
Answer: B. It is reduced by £9,000
The Personal Allowance is reduced by £1 for every £2 of
adjusted net income above £100,000. The excess is £18,000, so
the reduction is £9,000. Therefore, assuming no other relevant
adjustments, the Personal Allowance becomes £3,570. The
important calculation is based on adjusted net income rather
than simply employment salary.
,Question 3
Which statement correctly describes the effect of a qualifying
Gift Aid donation on an individual's income-tax position?
A. It reduces taxable income directly by the amount donated.
B. It provides a deduction against capital gains.
C. It extends the basic-rate band by the grossed-up amount of
the donation.
D. It is ignored when determining the individual's income-tax
liability.
Answer: C. It extends the basic-rate band by the grossed-up
amount of the donation.
Gift Aid operates through tax relief given to the charity and an
extension of the individual's basic-rate band. A cash donation is
treated as having been made net of basic-rate tax.
Consequently, the donation is grossed up before determining
the amount by which the relevant income-tax band is extended.
This can allow more income to be taxed at lower rates and can
be particularly valuable to higher-rate taxpayers.
Question 4
An individual makes a qualifying Gift Aid donation of £8,000.
What is the gross amount treated as donated for income-tax
purposes?
, A. £8,000
B. £9,000
C. £10,000
D. £10,667
Answer: C. £10,000
Gift Aid donations are normally treated as being made after
deduction of basic-rate income tax. A £8,000 net donation is
therefore grossed up by dividing by 80%, giving £10,000. The
£2,000 difference represents the basic-rate tax deemed to have
been deducted. The grossed-up figure is the amount relevant
when extending the individual's tax bands.
Question 5
Which taxpayer is entitled to claim the Marriage Allowance,
assuming all other eligibility conditions are satisfied?
A. A higher-rate taxpayer transferring £1,260 to a basic-rate
spouse
B. A spouse or civil partner who is eligible to transfer part of
their unused Personal Allowance to a basic-rate spouse or civil
partner
C. An additional-rate taxpayer transferring part of their
Personal Allowance
D. Any taxpayer who is married, regardless of their tax rate
