ATT Personal Tax Paper 1 Income Tax
Questions 2026 – Association of Taxation
Technicians 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 the 2026/27 tax year, an individual resident in England has
adjusted net income of £118,000 before making a personal
pension contribution. Ignoring any other reliefs, what is the
individual's Personal Allowance before considering the pension
contribution?
A. £12,570
B. £9,570
C. £3,570
D. Nil
Answer: B. £3,570
,The Personal Allowance for 2026/27 is £12,570 and 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, the
allowance is £12,570 − £9,000 = £3,570. The allowance is
completely withdrawn once the relevant income reaches
£125,140.
Question 2
Which item is normally treated as savings income for UK
Income Tax purposes?
A. Salary from employment
B. Bank interest
C. Rental income
D. Trading profits
Answer: B. Bank interest
Interest arising from bank and building-society accounts is
generally savings income. Savings income is taxed using the
applicable savings rates after considering the individual's tax
bands and any available Personal Savings Allowance.
Employment income, property income and trading profits fall
into different categories and are not normally classified as
savings income.
,Question 3
For 2026/27, what is the Personal Savings Allowance available
to an individual who is a higher-rate taxpayer?
A. £250
B. £500
C. £1,000
D. £1,500
Answer: B. £500
For 2026/27, a basic-rate taxpayer generally has a £1,000
Personal Savings Allowance, while a higher-rate taxpayer has a
£500 allowance. An additional-rate taxpayer does not receive a
Personal Savings Allowance. The allowance applies to qualifying
savings income rather than employment or dividend income.
Question 4
An individual has taxable non-savings income of £30,000 and
savings income of £8,000 in 2026/27. Ignoring the Personal
Allowance because it has already been deducted, which portion
of the savings income can potentially qualify for the 0% starting
rate for savings?
A. £0
B. £2,000
, C. £5,000
D. £8,000
Answer: B. £2,000
The starting-rate-for-savings band can provide a 0% rate on up
to £5,000 of savings income, but its availability is restricted by
non-savings income. Broadly, the £5,000 starting rate band is
reduced by taxable non-savings income above the Personal
Allowance. Here, taxable non-savings income is £30,000, which
is £17,430 above the £12,570 Personal Allowance equivalent
used in the calculation. The available starting-rate band is
therefore nil, not £2,000. Accordingly, the correct answer should
be A.
Correction: A. £0
Because the individual's taxable non-savings income exceeds
the Personal Allowance by more than £5,000, the starting-rate-
for-savings band has been fully eliminated. This is a useful
distinction from the Personal Savings Allowance, which is a
separate mechanism available to qualifying taxpayers.
Question 5
An individual receives £2,000 of dividends in 2026/27 and has
sufficient unused basic-rate band for all of those dividends.
Questions 2026 – Association of Taxation
Technicians 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, an individual resident in England has
adjusted net income of £118,000 before making a personal
pension contribution. Ignoring any other reliefs, what is the
individual's Personal Allowance before considering the pension
contribution?
A. £12,570
B. £9,570
C. £3,570
D. Nil
Answer: B. £3,570
,The Personal Allowance for 2026/27 is £12,570 and 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, the
allowance is £12,570 − £9,000 = £3,570. The allowance is
completely withdrawn once the relevant income reaches
£125,140.
Question 2
Which item is normally treated as savings income for UK
Income Tax purposes?
A. Salary from employment
B. Bank interest
C. Rental income
D. Trading profits
Answer: B. Bank interest
Interest arising from bank and building-society accounts is
generally savings income. Savings income is taxed using the
applicable savings rates after considering the individual's tax
bands and any available Personal Savings Allowance.
Employment income, property income and trading profits fall
into different categories and are not normally classified as
savings income.
,Question 3
For 2026/27, what is the Personal Savings Allowance available
to an individual who is a higher-rate taxpayer?
A. £250
B. £500
C. £1,000
D. £1,500
Answer: B. £500
For 2026/27, a basic-rate taxpayer generally has a £1,000
Personal Savings Allowance, while a higher-rate taxpayer has a
£500 allowance. An additional-rate taxpayer does not receive a
Personal Savings Allowance. The allowance applies to qualifying
savings income rather than employment or dividend income.
Question 4
An individual has taxable non-savings income of £30,000 and
savings income of £8,000 in 2026/27. Ignoring the Personal
Allowance because it has already been deducted, which portion
of the savings income can potentially qualify for the 0% starting
rate for savings?
A. £0
B. £2,000
, C. £5,000
D. £8,000
Answer: B. £2,000
The starting-rate-for-savings band can provide a 0% rate on up
to £5,000 of savings income, but its availability is restricted by
non-savings income. Broadly, the £5,000 starting rate band is
reduced by taxable non-savings income above the Personal
Allowance. Here, taxable non-savings income is £30,000, which
is £17,430 above the £12,570 Personal Allowance equivalent
used in the calculation. The available starting-rate band is
therefore nil, not £2,000. Accordingly, the correct answer should
be A.
Correction: A. £0
Because the individual's taxable non-savings income exceeds
the Personal Allowance by more than £5,000, the starting-rate-
for-savings band has been fully eliminated. This is a useful
distinction from the Personal Savings Allowance, which is a
separate mechanism available to qualifying taxpayers.
Question 5
An individual receives £2,000 of dividends in 2026/27 and has
sufficient unused basic-rate band for all of those dividends.
