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Dana has to pay 25% tax on any income above £24,000 per year. Dana is paid £36,000 annually. Calculate the amount of money she receives after tax each month.

User Sampada
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Answer:

£2,750

Explanation:

Tax rule: 25% tax on any income above £24,000 per year

It means that upto £24,000 there is no tax and the amount above £24,000

is taxable.

Annual payment of Dana = £36,000

Hence, she will be taxed only on amount above £24,000 out of £36,000.

Lets find amount above £24,000 = £36,000- £24,000 = £12,000

Tax on £12,000 = 25% of £12,000 = 25/100 * £12,000 = £3,000

Thus, £3,000 will be deducted as tax annually out of total earning of £36,000.

Amount paid to Dana after deduction of tax annually = £36,000 - £3,000

Amount paid to Dana after deduction of tax annually is £33,000

As one year has 12 months , hence it can be also said that in 12 months she is paid £33,000

the amount of money she receives after tax in 12 month = £33,000

Dividing LHS and RHS by 12

The amount of money she receives after tax in 12/12 month = £33,000/12

The amount of money she receives after tax in 1 month = £2,750

The amount of money Dana receives after tax each month is £2,750.

User Ooh
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