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Noah098
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Sir, in my study kit I came across this following question, which bewildered me a bit. Here it is:
(Paraphrasing it in short)
Trading income= 41870 pounds
Employment income= 12250
PAYE=80pounds(dedcuted from employment income)
Calculate Income tax payable.Sir if a company has a PAYE system and taxes are deducted at source, why then only a partial amount(80/12280=0.653%) of tax has been deducted and the remaining left for the individual to pay along with their trading income.
Thank you.
Tax Tutor
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Have you worked through the PAYE section of the Study Notes for chapter 9 which tells you in section 8.4:
“The PAYE code will include the employee’s personal allowance”
A further point for you to remember when answering an exam question. You answer the question that has been set, you do not query the information in it – you process that information to derive the correct answer.
Noah098
Tax Tutor
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