Income Tax 2

Example:

Mr Nelson earns €700 per week. His standard cut-off point is €500.  His tax credit is €35 per week.  The standard rate of income tax is 20% and the higher rate is 40%.

Calculate his i)    Tax payable
                    ii)    Take home pay

Gross Tax        =        €500 x 20%    =    €100

                                  €200 x 40%    =    €80

Total Gross Tax    =    €100 + €80    =    €180

Tax Payable        =    Gross Tax - Tax Credit

                           =    €180 - €35

                           =    €145

Take home pay    =    Gross Wage - Tax Payable

                            =    €700 - €145

                            =    €555

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Q.1        Mr Moynihan earns €720 per week.  His standard cut-off point is €580.  His tax credit is
              €40 per week.  The standard rate of income tax is 20% and the higher rate is 40%.

Tax Payable ____________________                Take home pay ___________________

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Q.2         Mrs O'Leary earns €650 per week.  Her standard cut-off point is €520.  Her tax credit is
              €25 per week.  The standard rate of income tax is 20% and the higher rate is 40%.

Tax Payable ___________________                Take home pay ______________________

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Q.3         Mr Nolan earns €820 per week.  His standard cut-off point is €650.  His tax credit is
              €56 per week.  The standard rate of income tax is 20% and the higher rate is 40%.

Tax Payable ____________________                Take home pay _______________________

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Q.4         Ms Reilly earns €425 per week.  Her standard cut-off point is €305.  Her tax credit is
              €23 per week.  The standard rate of income tax is 20% and the higher rate is 40%.

Tax Payable ____________________                Take home pay  _____________________

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