ATT Personal Tax Paper 1 Certification Exam
2026 – Association of Taxation Technicians
Paper 1: Personal Taxation Practice Exam 2026
| Practice Questions & Study Guide |
Complete Exam-Style Questions with Correct
Detailed Answers & Rationales (Reliable
Answers) | Latest Updated Version | Instant
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Question 1
For 2026/27, an individual has employment income of £48,000
and savings income of £2,000. They have no other income and
are entitled to the standard Personal Allowance. What is their
taxable income?
A. £37,430
B. £38,000
C. £40,000
D. £50,000
Correct answer: A. £37,430
,The individual has total income of £50,000. The standard
Personal Allowance is £12,570, so taxable income is £50,000 −
£12,570 = £37,430. The Personal Allowance is deducted from
total income before determining the amount remaining within
the Income Tax bands. The fact that £2,000 is savings income
affects the ordering and taxation of the income, but it does not
change the basic calculation of total taxable income in this
question.
Question 2
An individual has adjusted net income of £112,000 for 2026/27.
Ignoring any pension contributions or Gift Aid, what is their
Personal Allowance?
A. £12,570
B. £9,000
C. £6,570
D. £0
Correct answer: C. £6,570
The Personal Allowance is reduced by £1 for every £2 by which
adjusted net income exceeds £100,000. The excess is £12,000,
so the reduction is £6,000. Therefore, the available Personal
Allowance is £12,570 − £6,000 = £6,570. The allowance is
,completely eliminated once adjusted net income reaches
£125,140.
Question 3
Which statement correctly describes the 2026/27 dividend
allowance for an individual?
A. The first £1,000 of dividends is exempt from tax
B. The first £500 of dividends is taxed at 0%
C. All dividends are taxed at the basic rate
D. Dividends are excluded from taxable income entirely
Correct answer: B. The first £500 of dividends is taxed at 0%
For 2026/27, the dividend allowance is £500. It is technically a
nil-rate band rather than an exemption. Dividends within the
allowance are still treated as dividend income, but no Income
Tax is charged on that portion. Dividends exceeding the
allowance are taxed at the applicable dividend rate according
to the taxpayer's tax band.
Question 4
An individual receives £8,000 of bank interest during 2026/27.
Their non-savings income is £14,000 and they have no dividend
, income. What is the maximum amount of the interest that
could potentially qualify for the starting rate for savings?
A. £5,000
B. £8,000
C. £3,000
D. £1,000
Correct answer: A. £5,000
The starting rate for savings can apply to up to £5,000 of
savings income where the individual's other income is
sufficiently low. The starting-rate band is reduced by £1 for
every £1 of other income above the Personal Allowance. Here,
non-savings income is £14,000, which is £1,430 above the
£12,570 Personal Allowance. Consequently, the full £5,000
starting-rate band would not actually be available. The question
asks for the maximum amount that could potentially qualify
under the statutory starting-rate limit, which is £5,000.
Question 5
Which of the following is normally treated as a benefit in kind
when provided to an employee for private use?
A. Reimbursement of genuine business travel at approved rates
B. A qualifying workplace pension contribution made by the
employer
2026 – Association of Taxation Technicians
Paper 1: 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 2026/27, an individual has employment income of £48,000
and savings income of £2,000. They have no other income and
are entitled to the standard Personal Allowance. What is their
taxable income?
A. £37,430
B. £38,000
C. £40,000
D. £50,000
Correct answer: A. £37,430
,The individual has total income of £50,000. The standard
Personal Allowance is £12,570, so taxable income is £50,000 −
£12,570 = £37,430. The Personal Allowance is deducted from
total income before determining the amount remaining within
the Income Tax bands. The fact that £2,000 is savings income
affects the ordering and taxation of the income, but it does not
change the basic calculation of total taxable income in this
question.
Question 2
An individual has adjusted net income of £112,000 for 2026/27.
Ignoring any pension contributions or Gift Aid, what is their
Personal Allowance?
A. £12,570
B. £9,000
C. £6,570
D. £0
Correct answer: C. £6,570
The Personal Allowance is reduced by £1 for every £2 by which
adjusted net income exceeds £100,000. The excess is £12,000,
so the reduction is £6,000. Therefore, the available Personal
Allowance is £12,570 − £6,000 = £6,570. The allowance is
,completely eliminated once adjusted net income reaches
£125,140.
Question 3
Which statement correctly describes the 2026/27 dividend
allowance for an individual?
A. The first £1,000 of dividends is exempt from tax
B. The first £500 of dividends is taxed at 0%
C. All dividends are taxed at the basic rate
D. Dividends are excluded from taxable income entirely
Correct answer: B. The first £500 of dividends is taxed at 0%
For 2026/27, the dividend allowance is £500. It is technically a
nil-rate band rather than an exemption. Dividends within the
allowance are still treated as dividend income, but no Income
Tax is charged on that portion. Dividends exceeding the
allowance are taxed at the applicable dividend rate according
to the taxpayer's tax band.
Question 4
An individual receives £8,000 of bank interest during 2026/27.
Their non-savings income is £14,000 and they have no dividend
, income. What is the maximum amount of the interest that
could potentially qualify for the starting rate for savings?
A. £5,000
B. £8,000
C. £3,000
D. £1,000
Correct answer: A. £5,000
The starting rate for savings can apply to up to £5,000 of
savings income where the individual's other income is
sufficiently low. The starting-rate band is reduced by £1 for
every £1 of other income above the Personal Allowance. Here,
non-savings income is £14,000, which is £1,430 above the
£12,570 Personal Allowance. Consequently, the full £5,000
starting-rate band would not actually be available. The question
asks for the maximum amount that could potentially qualify
under the statutory starting-rate limit, which is £5,000.
Question 5
Which of the following is normally treated as a benefit in kind
when provided to an employee for private use?
A. Reimbursement of genuine business travel at approved rates
B. A qualifying workplace pension contribution made by the
employer
