For many visas and citizenship, you must have a certificate that you passed the Life in the UK test. This never expires so you can take it any time.
You must book your test at an official test centre. 1
You'll be tested on the information in the official handbook, so study this to prepare for the test. You'll have 45 minutes to answer 24 questions. You can buy the study pack from the affiliate Amazon link or from the government bookstore directly 2.
This is primarily a trivia memorisation exercise, as many British people can't pass this test without studying, it has been described it as "like a bad pub quiz" and "unfit for purpose". 3
The handbook contains about 3,000 facts including five telephone numbers, 34 websites, 278 historical dates and several brief excerpts of poetry.
You may find the lecture by (American) Dr. Thom Brooks at Durham University interesting as he describes his experience of the test.