Laws And Legal Concepts Relevant To Financial Advice Flashcards Preview

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Flashcards in Laws And Legal Concepts Relevant To Financial Advice Deck (30)
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1

What is a sole trader

Self employed

2

What tax is payable by a sole trader

Income tax and capital gains tax
NIC Class 2 and 4
Secondary Class 1 NIC for employees

3

What is a partnership

Largely the same as a sole trader but liability reflects share of business

4

What is an LLP

Partnership is a seperate legal person so the partners are not individually liable for debts of the LLP

5

What is a limited company

A seperate legal entity which is registered on the Register of Companies

6

What is the difference between a Plc. a Ltd.

Plc is publicly listed whereas ltd companies are privately owned

7

Who controls takeovers of Plcs

The takeover panel

8

What is enduring power of attorney and when was it introduced

Allows power of attorney to continue in the event of incapacity

9

When must enduring power of attorney have been established for it to qualify

Before October 2007 when the giver had full mental capacity

10

Does enduring power of attorney cover attitude to healthcare

No

11

Which act introduced lasting power of attorney

Mental capacity act 2005

12

What powers does lasting power of attorney give

Power to make decisions about health, welfare and property and financial affairs

13

What 5 things must there be for a binding contract

Offer
Acceptance
Intention
Power to contract
Consideration

14

In the case of a life insurance contract, what additional things must there be for a contract to be binding

Utmost good faith
Insurable interest

15

In a life insurance contract what constitutes N offer

The proposal

16

What constitutes acceptance in a life insurance contract

First premium payment

17

What is a joint tenancy

Equal shares and neither can sell without the others permission

18

What is a tenancy in common

Each holds separate shares and can dispose of the shares as they wish

19

What is the alternative to bankruptcy

Make an individual voluntary arrangement

20

Who is responsible for realising and distributing an estate in individual bankruptcy

Trustee

21

What order are debts paid in in bankruptcy

Costs of bankruptcy
Preferential debts
Ordinary unsecured creditors

22

How is appointed to deal with corporate insolvency

Liquidator

23

What are the alternatives to corporate insolvency

Administration or voluntary arrangements

24

What is needed to formally create a will

Writing, a signature and 2 witnesses (attestation)

25

How can you revoke a will

Write. New one,
Deliberately destroy it with intent to revoke
Get married
Divorce (revokes in part)

26

Who gets what if someone dies intestate with spouse and issue

Spouse gets personal chattels, £250,000 and half remaining balance. Children get other half on reaching 18 or marriage

27

What happens if someone dies intestate with no spouse

Everything goes to issue. If no issue goes to parents, siblings, grandparents hen aunts and uncles in that order

28

What happens if someone dies intestate with no relatives

Goes to the crown unless live in Lancaster or Cornwall in which case goes to the Duchy of Lancaster/Cornwall

29

What are the main uses of trusts

IHT planning
Pensions

30

What are the 3 certainties of. Trust

Words must be imperative
Subject must be certain
Objects, beneficiaries of trust must be certain