You asked about whether it is ability or age... it is generally a combination of both. As other posters have said, there is a minimum age for taking the exams, and also they have to be ready to take it. Don't be concerned at all - just let her enjoy herself!
It depends on the exam board but a child would usually be entered for pre primary once they are 5 and have had around 12-18 months worth if lessons although obviously sine children will progress faster or slower than others.
Just check with the teacher. My DD1's dance school only does exams every 2 years & wouldn't dream of entering them as young as 4 so she was 6 when she first did any. TBH it's supposed to be fun & I could do without the stress it causes me anyway! Lots of dance classes will overlap anyway with pre-primary / primary meeting for some aspects.
Maybe someone can answer some of my questions. What age are they put in for their pre primary test? Are they entered on ability or age? My daughter has been going since may last year, she is 4 (5 in July). Some have been entered, some haven't-my daughter hasnt. Most of the ones entered are older than my daughter and have been going longer but I think that several who she is friends with will now be moving up a class which is a shame. What normally happens? What are decisions based on? Thanks xxx