ATT Personal Tax Paper 1 Final Certification
Exam Questions and Revised Answers 2026/2027
– Personal Taxation Study Guide. Free Pdf
Access.
About This Exam
The ATT Paper 1 – Personal Taxation is one of the compulsory online exams for the ATT
qualification. The exam is currently three and a half hours in length, consisting of both
computational and written long-form questions . The pass mark is 50% of the total
marks available . The exam can test elements of Ethics alongside the technical content .
Important Note: The ATT does not publish a large bank of official practice questions.
The following practice exam is constructed based on the official syllabus domains and
themes identified in ATT examiner reports, including employment income, capital gains
tax, overseas aspects, property income, and ethics .
Section A: Income Tax and Employment Income
Question 1: An employee receives a company car with a list price of
£32,000. The car has a CO2 emission rating of 125g/km. The employee
makes a capital contribution of £3,000 towards the car and pays £150
per month towards private fuel. Calculate the taxable benefit for the
2024/25 tax year, assuming the appropriate percentage is 30%.
Answer:
List price: £32,000
Less capital contribution (capped at £5,000): (£3,000)
, Adjusted list price: £29,000
Benefit percentage: 30%
Car benefit: £29,000 × 30% = £8,700
Fuel benefit: £27,800 (fixed figure) × 30% = £8,340
Total taxable benefit: £17,040
Explanation: The car benefit is calculated on the list price plus
accessories, less capital contributions (capped at £5,000). The fuel
benefit uses the fixed figure set by HMRC multiplied by the same
percentage. Examiner reports note that candidates frequently incorrectly
use the price paid by the company rather than the list price .
Question 2: An employee is provided with a loan of £15,000 by their
employer at an interest rate of 1.5%. The official rate of interest is
2.25%. Calculate the taxable benefit.
Answer:
Loan amount: £15,000
Official rate: 2.25%
Actual rate: 1.5%
Difference: 0.75%
Taxable benefit: £15,000 × 0.75% = £112.50
Explanation: The benefit is calculated on the difference between the
official rate and the rate actually charged. If the loan is below £10,000,
no benefit arises. This is a common calculation in employment income
questions.
, Question 3: Explain the tax treatment of Enterprise Management
Incentive (EMI) options on grant and exercise.
Answer:
On grant: No income tax charge arises when qualifying EMI options
are granted, provided the exercise price is at least equal to the market
value at grant.
On exercise: If the option is exercised at the market value at grant (or
higher), no income tax arises on exercise. If exercised at a discount, the
discount is subject to income tax.
On sale: The gain from the sale of the shares is subject to Capital
Gains Tax (CGT), with the base cost being the exercise price plus any
amount subject to income tax on exercise.
Explanation: The sample ATT Paper 1 question for 2025 exams includes
a scenario involving EMI options . This is a high-yield topic. Examiner
reports highlight that candidates often confuse income tax reliefs with
CGT deferral rules .
Question 4: An employee receives a beneficial loan of £12,000 at 0%
interest. What is the taxable benefit if the official rate is 2.25%?
Answer:
Loan amount: £12,000
Official rate: 2.25%
Actual rate: 0%
Difference: 2.25%
Taxable benefit: £12,000 × 2.25% = £270
, Explanation: Since the loan exceeds £10,000, a benefit arises. The benefit
is calculated using the difference between the official rate and the actual
rate charged.
Question 5: A self-employed individual has a trading profit of £85,000
for 2024/25. Calculate their Class 4 National Insurance contributions.
Answer:
Lower Profits Limit: £12,570
Upper Profits Limit: £50,270
Profits between LPL and UPL: £50,270 - £12,570 = £37,700
Profits above UPL: £85,000 - £50,270 = £34,730
Class 4 NIC: (£37,700 × 6%) + (£34,730 × 2%)
Class 4 NIC: £2,262 + £694.60 = £2,956.60
Explanation: Class 4 NICs are payable by the self-employed on profits
between the Lower and Upper Profits Limits at 6%, and above the Upper
Profits Limit at 2%. The syllabus includes Class 1, 2, and 4 NICs as a key
practice focus .
Question 6: A client is a higher rate taxpayer with employment
income of £60,000. They also receive £5,000 in dividends. Calculate the
income tax payable on the dividends for 2024/25.
Answer:
Dividend allowance: £500 (taxed at 0%)
Taxable dividends: £5,000 - £500 = £4,500
Exam Questions and Revised Answers 2026/2027
– Personal Taxation Study Guide. Free Pdf
Access.
About This Exam
The ATT Paper 1 – Personal Taxation is one of the compulsory online exams for the ATT
qualification. The exam is currently three and a half hours in length, consisting of both
computational and written long-form questions . The pass mark is 50% of the total
marks available . The exam can test elements of Ethics alongside the technical content .
Important Note: The ATT does not publish a large bank of official practice questions.
The following practice exam is constructed based on the official syllabus domains and
themes identified in ATT examiner reports, including employment income, capital gains
tax, overseas aspects, property income, and ethics .
Section A: Income Tax and Employment Income
Question 1: An employee receives a company car with a list price of
£32,000. The car has a CO2 emission rating of 125g/km. The employee
makes a capital contribution of £3,000 towards the car and pays £150
per month towards private fuel. Calculate the taxable benefit for the
2024/25 tax year, assuming the appropriate percentage is 30%.
Answer:
List price: £32,000
Less capital contribution (capped at £5,000): (£3,000)
, Adjusted list price: £29,000
Benefit percentage: 30%
Car benefit: £29,000 × 30% = £8,700
Fuel benefit: £27,800 (fixed figure) × 30% = £8,340
Total taxable benefit: £17,040
Explanation: The car benefit is calculated on the list price plus
accessories, less capital contributions (capped at £5,000). The fuel
benefit uses the fixed figure set by HMRC multiplied by the same
percentage. Examiner reports note that candidates frequently incorrectly
use the price paid by the company rather than the list price .
Question 2: An employee is provided with a loan of £15,000 by their
employer at an interest rate of 1.5%. The official rate of interest is
2.25%. Calculate the taxable benefit.
Answer:
Loan amount: £15,000
Official rate: 2.25%
Actual rate: 1.5%
Difference: 0.75%
Taxable benefit: £15,000 × 0.75% = £112.50
Explanation: The benefit is calculated on the difference between the
official rate and the rate actually charged. If the loan is below £10,000,
no benefit arises. This is a common calculation in employment income
questions.
, Question 3: Explain the tax treatment of Enterprise Management
Incentive (EMI) options on grant and exercise.
Answer:
On grant: No income tax charge arises when qualifying EMI options
are granted, provided the exercise price is at least equal to the market
value at grant.
On exercise: If the option is exercised at the market value at grant (or
higher), no income tax arises on exercise. If exercised at a discount, the
discount is subject to income tax.
On sale: The gain from the sale of the shares is subject to Capital
Gains Tax (CGT), with the base cost being the exercise price plus any
amount subject to income tax on exercise.
Explanation: The sample ATT Paper 1 question for 2025 exams includes
a scenario involving EMI options . This is a high-yield topic. Examiner
reports highlight that candidates often confuse income tax reliefs with
CGT deferral rules .
Question 4: An employee receives a beneficial loan of £12,000 at 0%
interest. What is the taxable benefit if the official rate is 2.25%?
Answer:
Loan amount: £12,000
Official rate: 2.25%
Actual rate: 0%
Difference: 2.25%
Taxable benefit: £12,000 × 2.25% = £270
, Explanation: Since the loan exceeds £10,000, a benefit arises. The benefit
is calculated using the difference between the official rate and the actual
rate charged.
Question 5: A self-employed individual has a trading profit of £85,000
for 2024/25. Calculate their Class 4 National Insurance contributions.
Answer:
Lower Profits Limit: £12,570
Upper Profits Limit: £50,270
Profits between LPL and UPL: £50,270 - £12,570 = £37,700
Profits above UPL: £85,000 - £50,270 = £34,730
Class 4 NIC: (£37,700 × 6%) + (£34,730 × 2%)
Class 4 NIC: £2,262 + £694.60 = £2,956.60
Explanation: Class 4 NICs are payable by the self-employed on profits
between the Lower and Upper Profits Limits at 6%, and above the Upper
Profits Limit at 2%. The syllabus includes Class 1, 2, and 4 NICs as a key
practice focus .
Question 6: A client is a higher rate taxpayer with employment
income of £60,000. They also receive £5,000 in dividends. Calculate the
income tax payable on the dividends for 2024/25.
Answer:
Dividend allowance: £500 (taxed at 0%)
Taxable dividends: £5,000 - £500 = £4,500
