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A question regarding example 14 in chapter 2 in ot notes
What reason behind calculating 160000-8000=152000
If we actually use the simple 160000 in calulcating tax liability.
I did working 1 then used same figure 152000 in calculating tax liability!!
2) In chapter 2 jointly owned lecture, i dont understand how husband has 1000×0%
4000×20%3) when dealing w jointly owned property the rule is always 50/50 regardless of for ex. 75% and 25% ownership percentage or shares am I right? Plz confirm
1) Read the notes carefully and you will see that adjusted net income needs to be computed to determine what restriction in the PA is required when net income exceeds 100,000. As clearly in this example adjusted net income exceeds 122,000 there is no PA available to the taxpayer.
The net income and taxable income on the income tax computation however are 160,000 – we do not deduct gift aid payments or PPC in computing taxable income.2) when I have found the part of the lecture you refer to I will get back yo you with answer
3) Wrong – read the notes – in chapter 2 section 6 page 15 you will read in the 2nd paragraph on joint property that an election may be made to split the joint income according to actual ownership rather than using the 50:50 rule
2) In the example the husband has total income of 15,000 of which 5,000 will be rental income (due to the 50:50 rule applying). Therefore as stated and shown in the lecture the other income is 10,000 so that this 5,000 rental income when assessed in his computation is firstly using up the remaining 1,000 of the PA (10,000 – 11,000) – hence 1,000 @ 0% and the remaining 4,000 falls into the basic rate band and is therefore taxed at 20%
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