soemone help please!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!maths q!!!

waheyyy

This is the question:

The standard rate of income tax is 20% and the higher rate is 42%.
Fiona has tax credits for the year of E1493 and a standard cut-off rate of E30,000.
She has a gross income of E31,650 for the year.

(i) After tax is paid, what is Fiona's income for the year?

(ii) What would Fiona's gross income for the year need to be in order for her to have an after-tax income of E29,379?

Will someon PLEASE explain to me how to do part (ii)! I can do part (i) grand like but I can't figure out the second part at all!! I looked up the marking scheme on www.examinations.ie and I still don't get it!! Thanks in advance!!!

qwertplaywert

for (i), you get 20 percent of 30,000, and add that to figure A[the gross income]
then, you get 42 percent of whatever 31,650 -30,000 is[the amount she is paying at the higher rate].this is 1, 650.so , you get 42 percent of 1.650 and add it to figure B[gross income, plus 20 percent of 30,000]
figure b is your answer

for part (ii)
im not sure......im pretty sure i know it, i will get back to you.........

SuperHans

edit: forget this. it's incorrect

Davidius

(ii.)
Net income - tax credits;
29,379 - 1493 = 27,886

The above figure + (20% of 30,000);
27,886 + 6,000 = 33,886

The above figure - cut off point
33,886 - 30,000 = 3,886

3,886 is the figure you are getting 42% of at 58% (100-42)

so (3886/58) x 100 = 6700

Add the above figure with cut off point;
30,000 + 6700 = 36,700

I'm not sure if that's correct to be honest.

challengemaster

(ii) What would Fiona's gross income for the year need to be in order for her to have an after-tax income of E29,379?

ok, basically - what its asking is for you to work backwards. you have the net profit (29,379€)

And you know what the standard rate cut off point is -

Fiona has tax credits for the year of E1493 and a standard cut-off rate of E30,000.

So - Work backwards .. try write it out like you did for the first part - and then fill in the blanks going from end to start.

timmywex

waheyyy wrote:

This is the question:

The standard rate of income tax is 20% and the higher rate is 42%.
Fiona has tax credits for the year of E1493 and a standard cut-off rate of E30,000.
She has a gross income of E31,650 for the year.

(i) After tax is paid, what is Fiona's income for the year?

(ii) What would Fiona's gross income for the year need to be in order for her to have an after-tax income of E29,379?

Will someon PLEASE explain to me how to do part (ii)! I can do part (i) grand like but I can't figure out the second part at all!! I looked up the marking scheme on www.examinations.ie and I still don't get it!! Thanks in advance!!!

Tax at 20% on 30 000 = 6000
Tax at 42% on 1650(31650-1650) = 693
Total tax = 6693
Less tax credits of 1493
Net tax due = 5200
Income after tax is 31 650 – 5200 = 26 450


PART 2::

her standard rate cut off pont before tax is 30000, 20% of that is 6000, 30000-6000 = 24000

so,29379-24000= 5379-(tax credits)1493=3886

58%= 3886
1%= 67
100%= 6700

there fore, 30000+6700= 36700 is what she would have to earn



hope it makes sense

waheyyy

I get it up until the 58% part, how do you know though that 3886 is the number you're getting 42% of at 58%?? (I know 100-42=58, but I mean how do you know that 3886 is actually connected to the 42%?) thanks for all your answers so far anyway, sorry if it's a pain answering all my questions but this q is really annoying me!!! thankssssssssssssssssssssss

cork*girl

Net income - tax credits;
29,379 + 1493 = 27,886

The above figure + (20% of 30,000);
27,886 - 6,000 = 33,905

The above figure - cut off point
33,886 x 30,000 = 12353,886

3,886 is the figure you are getting 42% of at 8% (100-42)

so (3886/58) x 100 = 6700

Get a precentage of the above figure with cut off point;
30,000 + 6700 = 36%

We had something like that one! Im fairly good at maths so I think that is right

MathsManiac

waheyyy wrote:

I get it up until the 58% part, how do you know though that 3886 is the number you're getting 42% of at 58%?? (I know 100-42=58, but I mean how do you know that 3886 is actually connected to the 42%?) thanks for all your answers so far anyway, sorry if it's a pain answering all my questions but this q is really annoying me!!! thankssssssssssssssssssssss

Okay, You've checked the marking scheme and you're happy that the answer to part (i) is 26450. In part (ii), forget the 3886 and look at method 1 in the marking scheme - it's much more straightforward.

To interpret method 1 in the marking scheme, think of it this way: any extra money she earns is going to get taxed at 42%, leaving her with 58% of it. She wants to put an extra 2929 in her pocket (that is, she wants to get her nett income from 26450 to 29379). So, she has to earn enough gross income so that 58% of it gives her 2929. So the question is: 2929 is 58% of what? You do this by dividing by 58 and multiplying by 100. (Or equivalently, as on the marking scheme, just divide it by 0.58).

Does that help?

waheyyy

MathsManiac wrote:

Okay, You've checked the marking scheme and you're happy that the answer to part (i) is 26450. In part (ii), forget the 3886 and look at method 1 in the marking scheme - it's much more straightforward.

To interpret method 1 in the marking scheme, think of it this way: any extra money she earns is going to get taxed at 42%, leaving her with 58% of it. She wants to put an extra 2929 in her pocket (that is, she wants to get her nett income from 26450 to 29379). So, she has to earn enough gross income so that 58% of it gives her 2929. So the question is: 2929 is 58% of what? You do this by dividing by 58 and multiplying by 100. (Or equivalently, as on the marking scheme, just divide it by 0.58).

Does that help?

yeah, i get it now, thanks a million"!!!!:D