Question

Juliette earns $4500 per month. She gets a free tax allowance of $10,000 per year and pays tax at 20% on the rest. How much tax will she pay in a year?

(A) $8,800
(B) $9,900
(C) $11,000
(D) $12,100

Answer 1

Juliette earns $4500 per month and after subtracting her tax-free allowance of $10,000 from her annual income, she will pay 20% tax on the remainder. The total tax she will pay in a year is $8,800.

Step-by-step explanation:

To calculate how much tax Juliette will pay in a year, we need to follow these steps:

1. First, calculate her annual income by multiplying her monthly income by 12, which is $4500 × 12 = $54,000.
2. Next, subtract her tax-free allowance from her annual income, which is $54,000 - $10,000 = $44,000.
3. Finally, calculate the tax she has to pay on the remaining amount at 20%, which is 20% of $44,000 = 0.20 × $44,000 = $8,800.

Therefore, Juliette will pay $8,800 in tax for the year.