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calculating tax

  • 7 posts
  • # 80414

I am currently studying payroll and being confused with one tax related question.
the question is:

Mr A is under 60,earning 24000 Per year and joined the company in january. his tax code is 543L. what will be his tax for month 1 for the tax year 2010/11.

let me show you my calcuations:
As month 1 is April
for 2010/11
pay in the month is =2000
total pay to date =8000
total free pay = 454.01   (looking in table for month 1 for 543L)
total taxable pay to date = 7545.99
total tax due to date = 1509.20
so what will be the tax for month 1?  

I am very confused..i don;t know whether I have done it right or not? please all your suggestions are welcomed.
need for helpful reply at the earliest
Thank you

ketal
kjmcculloch
  • 1159 posts
  • # 80425

If this is month 1 why do you have a pay to date of £8000 showing?

Kris

Edited at 04 Mar 2012 06:44 PM GMT
Stardoe
  • Member PM.Dip
  • Practice Licence
  • 194 posts
  • # 80426

Hi Sohketa,

I assume that the employee joined in January 2010?  and you are trying to calculate the tax for month 1 of tax year 6 April 2010 to 5 April 2011?  If this is the case, then the date that he joined is immaterial.  In calculating tax for month 1, no previous earnings or total taxable pay is taken into account.  You just calculate on the earnings for one month...i.e. £2000.

Hope this helps.

Pauline
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