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Exam
linuxpenguins
Posts: 152 Forumite
Hi
I have an exam coming up and one of the mock questions is:
A higher-rate tax payer receives a net interest payment of 420 from his deposit account. How much tax, if any, is due?
A None
B 94.50
C 105.00
D 168.00
Answer is C
But how? x
I have an exam coming up and one of the mock questions is:
A higher-rate tax payer receives a net interest payment of 420 from his deposit account. How much tax, if any, is due?
A None
B 94.50
C 105.00
D 168.00
Answer is C
But how? x
0
Comments
-
Net is 20% tax off.
So get back to gross. you * 1.25
So 420 * 1.25 = £525 gross interest.
40% tax of £525 is £315 after higher rate tax.
Has already paid 20% tax, so need to take the difference. So £420 - £315 = £1050 -
PasturesNew wrote: »No, it should be D, £168. 40% of £420 = £168
Net means 20% already has been taken off.
Gross means none has been taken off.
0 -
Great! Thank you so much! x0
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