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Help with maths paper 1 q1

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  • 29-05-2007 1:12am
    #1
    kieranmcg1
    Closed Accounts Posts: 148 ✭✭


    I know this sounds lame but i just cannot work it out . On the 2006 paper Paper 1 question 1 part c how do you work out the tax he paid each week . Whatever way my teacher gave it to us i dont have a clu what the hell she was doing can anyone help plz


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    #2
    akb2006
    Closed Accounts Posts: 5 ✭akb2006


    Type out the question ,ill give you a reply in 5 minutes..


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    #3
    Raphael
    Closed Accounts Posts: 8,880 ✭✭✭Raphael


    Assuming it's the Ordinary Level one, which fits with your post, it's simple enough once you undertand the process.

    Colm is getting €900 a week, before tax. Now, that breaks down into three seperate parts - Untaxed, Low taxed, High taxed. The untaxed is based on his credits - The first 50 he earns is untaxed.

    The two rates and the cut of point apply to his taxed - The first €240 of his taxed income is calculated at 20%. Everything after that (Which comes to 610 -> 900-240-50) is calulated at 42%

    Then you just add it all up. 20% of 240 is €48, 42% of 610 is €256.20. So in total he's paying €304.20. Does that make sense?


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    #4
    Delphi91
    Registered Users Posts: 1,501 ✭✭✭Delphi91


    Actually, tax credits are subtracted at the END, not at the begining like the TFA's used to be.

    So you start with the whole salary, i.e. €900.

    The first €240 is taxed at 20% which gives a tax of €48.
    The rest (€900 - €240 = €660) is taxed at 42% which gives a tax of €277.20

    Therefore the gross tax is €277.20 + €48 which is €325.20.

    Now subtract the tax credit of €50 which gives the net tax paid each week of €275.20.

    For the second part, all you need to realise is that the raise will only be taxed at the higher rate ('cos only the first €240 of her salary is at the lower rate).

    So, whatever the raise is, once 42% of it is taken away, she gets to keep €20.30. Therefore this €20.30 must be 58% (100 - 42) of the raise.

    Simple arithmetic then tells you that the raise must be (€20.30/58) * 100 = €35


    Hope that helps?

    Check here for more info: http://www.jobsearch.ie/applicants/tax.htm

    Mike


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