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Dear tutor,
Could you please check this question?
Peter has taxable income for the tax year 2019/2020 as follow:
Non-saving income : 2,000
Savings income : 6,410What is Peter’s income tax liability for the tax year 2019/20?
I guessed the answer is 482 but anwer bank said it’s 882.
I understood that if Non-saving income is less than 5,000, saving income tax rate should start from 0%. The answer bank said Non saving income tax should be calculated 2,000*20%=400 but what about PA then….???This is one of those many examples that illustrate the need to CAREFULLY read the question when doing an objective testing question (as we mention in the lectures) – the question says the TAXABLE income is ….. – taxable income is of course after deducting the PA!
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