My Math Forum What is his taxable income and his tax free allowances?

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 April 20th, 2019, 12:29 PM #1 Senior Member     Joined: Jan 2012 Posts: 745 Thanks: 7 What is his taxable income and his tax free allowances? If the rates of tax consists of 10% on the first N 20 000 taxable income, 15% on the next N 20 000, 20% on the next N 20 000, and 25% on the next N 20 000; a man earns a salary of N 124 600 a year and pays an income tax of N 12 760. What is his taxable income and his tax free allowances?My problem is what do I do to get the taxable income? If I can get the taxable income, I can get the tax free allowances.
April 20th, 2019, 02:11 PM   #2
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Quote:
 If the rates of tax consists of 10% on the first N 20 000 taxable income, 15% on the next N 20 000, 20% on the next N 20 000, and 25% on the next N 20 000; a man earns a salary of N 124 600 a year and pays an income tax of N 12 760. What's his taxable income and tax free allowances?
Code:
                     tax     total tax
124600
20000   .10   2000    2000
--------
104600
20000   .15   3000    5000
--------
84600
20000   .20   4000    9000
--------
64600
15040   .25   3760  12760
--------
49560 = tax free

April 26th, 2019, 03:34 AM   #3
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Quote:
 Originally Posted by Denis Code:  tax total tax 124600 20000 .10 2000 2000 -------- 104600 20000 .15 3000 5000 -------- 84600 20000 .20 4000 9000 -------- 64600 15040 .25 3760 12760 -------- 49560 = tax free
From what you have done so far, I can say the taxable income is
₦124 600 - ₦49 560 = ₦75 040:
eek: But this baffles me. From what you did above, I can say that you calculated the tax from the salary which comprises both the taxable income and tax free income.
I even have to check the tax from the taxable income:
₦75 040 = ₦20 000 + ₦20 000 + ₦20 000 + ₦15 040
₦20 000 tax of ₦2 000
₦20 000 tax of ₦3 000
₦20 000 tax of ₦4 000
₦15 040 tax of ₦3 760
Total tax = ₦12 760

 Tags allowances, free, income, tax, taxable

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