Question

Ut John pays 25% tax on all his earnings over £20000.

Before tax, his earnings are £38000. How much tax
does he pay?

Answer 1

Answer: He pays £4500 as tax.

Explanation:

Given: John's earnings before tax = £38000 > £20000

Money over £20000 = £38000 - £20000 = £18000

Tax amount = 25% of money over £20000

⇒Tax amount= 0.25 x (18000 ) [25% = 0.25]

⇒Tax amount= £ 4500

Hence, he pays £4500 as tax.