Couple of calculations I need help with please

Maverick2332 · 15 May 2015 at 14:52

I recognise those questions, you wouldn't happen to be applying for a job with one of the big 6 energy companies would you OP?

Buckeyed · 15 May 2015 at 14:53

Freddie1980 said:
Q2

6,7475 to 37,400 = 30,925.00*0.2= 6,185
37,401 to 150,000 = 112,599.00*0.4 = 45,039.60
150,001 to 165,000 = 14,499.00*0.5 = 7,499.50

Total income tax is a criminal 58,724.10 GBP

The salary was £165,500 - you are £502 short if you add the amounts you have used in the multiplying calculations.

I calculate it as £58,975.

ubersonic · 15 May 2015 at 14:55

Cosimo said:
Not really sneaky nor requires knowledge of tax as the table tells you how to apportion the salary. Just have to use a little brain power to work it out.

No it does not, if your read and work out the question as it's written you will reach the wrong answer just as I did, to prove the point:

"The income tax rate is shown in the table below" - It is.

"Given that the free tax allowance is currently £6,475, calculate the tax due in year 2010-2011 on a salary of £165,500" - Okay so the first £6,475 doesn't count towards tax leaving £159,025 that does, according to the table the 2010-11 rate for taxable salary "Over £150,000" is 50%, 50% of £159,025 is £79,512.5, which is wrong because you're not supposed to read it as it's written.

so yes it is sneaky, yes it requires knowledge of tax and no you don't need to just have to use a little brain power to work it out.

joeyjojo · 15 May 2015 at 15:12

ubersonic said:
so yes it is sneaky, yes it requires knowledge of tax and no you don't need to just have to use a little brain power to work it out.

Exam questions shouldn't just need brain power, they are about testing knowledge, you know, facts not explicitly written in the question?

What would be the point of weeks/months of lessons if all the required information was in the question??

Anyway, everybody should know how income tax bands work in the UK. Bit worrying that you didn't.

Dave M · 15 May 2015 at 15:17

ubersonic said:
Yeah, you're right you would prob only be sitting this test if you already knew it isn't meant to be read as it's written, but they could have made it a bit more straightforward, I just feel cheated lol.

Hmm, it's not made obvious but a big part of passing a test is comprehension of the question. Lots of students failed lots of exams because they rushed into answering what they assumed was the question.

You certainly don't need to know anything about taxation to answer it correctly but if you do know a little about tax it will prompt you to double check.

yogibear88 · 15 May 2015 at 15:25

lord filbuster said:
I assume you don't need to know income tax rules for the 2nd one, because the income tax due would actually be £59969.10, as you lose your personal allowance if you earn over £120,000

In this question you lose your full annual allowance if you earn over £112,950. £120,000 is using 2014/15 personal allowance.

kPATm · 15 May 2015 at 16:13

Has anybody actually came up with the CORRECT answer for Q2?

joeyjojo · 15 May 2015 at 16:22

kPATm said:
Has anybody actually came up with the CORRECT answer for Q2?

What SciNet and Buckeyed did looks right. More importantly, do you understand how to work it out?

For anyone wondering, it's true that in 10/11 there would have been no personal allowance on 165,500, and also there would have been NI payments of £5,414.60 :cool:

Actual net wage would have been £99,815.40.

http://www.listentotaxman.com/165500?yr=2010

MooMoo444 · 15 May 2015 at 16:28

Worst 'I dont know how to math' thread ever

Freddie1980 · 15 May 2015 at 16:57

Buckeyed said:
The salary was £165,500 - you are £502 short if you add the amounts you have used in the multiplying calculations.

I calculate it as £58,975.

Your right! Well spotted.

Pudney · 15 May 2015 at 17:05

MooMoo444 said:
Worst 'I dont know how to math' thread ever

Worst "I watch too much American TV" post ever

kPATm · 15 May 2015 at 18:51

joeyjojo said:
What SciNet and Buckeyed did looks right. More importantly, do you understand how to work it out?

http://www.listentotaxman.com/165500?yr=2010

I do but now I have to try and get the Sister-in-Law to suss it as well???

wordy · 15 May 2015 at 19:04

The answer to both is 42.

Squark · 15 May 2015 at 19:07

MooMoo444 said:
Worst 'I dont know how to math' thread ever

You know how to mathematic?

NoobCannon · 15 May 2015 at 20:04

Your wrong about question 2

6475 personal allowance is no tax, 37400 is taxed at 20% giving 7480, 37402-150000 is 112600 at 40% giving 45040, remaining 9025 taxed at 50% giving 4512.5. Total tax is 57032.50. The personal allowance doesn't use up the basic rate band.

kPATm · 15 May 2015 at 20:38

So basically NO ONE agrees on how question 2 is worked out?

Amleto · 15 May 2015 at 20:41

NoobCannon said:
Your wrong about question 2

6475 personal allowance is no tax, 37400 is taxed at 20% giving 7480, 37402-150000 is 112600 at 40% giving 45040, remaining 9025 taxed at 50% giving 4512.5. Total tax is 57032.50. The personal allowance doesn't use up the basic rate band.

You're wrong about spellingses

NoobCannon · 15 May 2015 at 21:27

To be fair i cheated and asked my accountant friend and pasted his answer lol. It must be right or he wouldnt be where he is

Pudney · 15 May 2015 at 21:54

NoobCannon said:
To be fair i cheated and asked my accountant friend and pasted his answer lol. It must be right or he wouldnt be where he is

Don't rely on your friend for tax advice.

kPATm · 15 May 2015 at 23:10

NoobCannon said:
Your wrong about question 2

6475 personal allowance is no tax, 37400 is taxed at 20% giving 7480, 37402-150000 is 112600 at 40% giving 45040, remaining 9025 taxed at 50% giving 4512.5. Total tax is 57032.50. The personal allowance doesn't use up the basic rate band.

Thats the way I had originally worked it out before starting the thread?