Couples tax saving

QUESTION:

Page 93 Kaplan study text
Ting is married to Ning. She has employment income of £54,000 p.a.
She has various bank accounts from which she receives interest of £5,625 each year.
Ning earns £20,000 trading profits from self-employment each year. He has no other income.
Calculate the couple’s income tax liabilities for the tax year 2024/25 and advise how they could have saved tax by reorganizing their investments.

Solution
Ting – Income tax computation – 2024/25
Nonsavings
income
Savings
income
Total
£ £ £
Employment income 54,000 54,000
Bank interest 5,625 5,625
–––––– –––––– ––––––
Total income 54,000 5,625 59,625
Less: PA (12,570) (12,570)
–––––– –––––– ––––––
Taxable income 41,430 5,625 47,055
–––––– –––––– ––––––

Income tax: £ £
Non-savings income – basic rate 37,700 × 20% 7,540
Non-savings income – higher rate 3,730 × 40% 1,492
––––––
41,430
Savings income – nil rate 500 × 0% 0
Savings income – higher rate 5,125 × 40% 2,050
––––––
47,055
–––––– ––––––
Income tax liability 11,082
–––––

Ning – Income tax computation – 2024/25

Ning – Income tax computation – 2024/25
Nonsavings
income
£
Trading income 20,000
Less: PA (12,570)
––––––
Total income 7,430
––––––
Income tax liability (£7,430 × 20%) 1,486
––––––
Tax saving advice
Ting is a higher rate taxpayer. She has a savings income nil rate band
of £500 and mainly pays tax on her investment income at 40%. Ning,
however, is a basic rate taxpayer, and has a savings income nil rate
band of £1,000.
If the bank accounts were in Ning’s name the first £1,000 of interest
would be tax-free and he would pay tax at 20% on the balance of
£4,625. His tax liability on the interest would be £925 and the couple
would save tax of £1,125 (i.e. £500 × 40% + £4,625 × 20%).
Alternatively Ting could invest up to £20,000 in an ISA. The interest
would be tax-free. If some of the bank account is in Ning’s name, he
could also transfer up to £20,000 into a different ISA in his own name.

MY QUERY:

If the bank accounts were in Ning’s name, the couple would save £1,125.
When Ting was assessed on interest income = £ 2050
If Ning were assessed = £ 925
£ 2050 – £ 925 = £ 1125.

I understand this but I don’t understand why they are doing £500 * 40% in the brackets. What is that and how to think to arrive at £ 500 * 40%?