ACCA paper F6 UK Basic Income Tax computation | PAYE, Exempt income & Charitable giving | Example

Example 4

Peter who is single and earns £51475, made gift aid payment totaling £1960

Required

His income tax liability

Solution

Net income Less: PA Taxable income	51475 (6475) 45000

		£
Income tax	£39850 (W) £5150 × 40%	7970 2060 10030

Working

His basic rate band is extended by the gross gift aid payments £37400 + (£1960 × 100/80)= £39850