Starter quiz
- ______ Tax is tax that you pay on your income.
- 'Income' ✓
- National ______ is a tax on income which qualifies you to certain benefits, such as the State Pension and maternity pay.
- 'Insurance' ✓
- ______ Tax (VAT) is a tax that is added to most products and services sold by businesses.
- 'Value Added' ✓
- The amount of money you can earn without having to pay Income Tax is called your ...
- additional rate
- basic rate
- higher rate
- personal allowance ✓
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- A store in the USA has a pair of sneakers on display. The price tag reads $31.99 and the Sales Tax is 15%. What do the sneakers cost?
- '$36.79' ✓
- A shop in the UK has a pair of trainers on display. The price tag reads £55.99 and VAT is 20%. What do the trainers cost?
- '£55.99' ✓
Exit quiz
- An employee works 168 hours in a month and is paid £23.50 per hour. What is their gross pay?
- '£3948' ✓
- An employee works 152 hours in a month and is paid £29.50 per hour. What is their gross pay?
- '£4484' ✓
- An employee works 168 hours in a month and is paid £23.50 per hour. Their pension contribution is 5% of their gross pay. Calculate their pension contribution for this month.
- '£197.40' ✓
- An employee works 152 hours in a month and is paid £29.50 per hour. Their pension contribution is 6% of their gross pay. Calculate their pension contribution for this month.
- '£269.04' ✓
- One month, an employee is left with a taxable income of £3750. The first £1048 earned is tax-free and then up to the next £3141 is taxed at 8%. How much of the taxable income is taxed at 8%?
- '£2702' ✓
- One month, an employee is left with a taxable income of £3750. The first £1048 earned is tax-free and then up to the next £3141 is taxed at 20%. How much tax is owed?
- '540.40' ✓
Worksheet
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Presentation
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Video
Lesson Details
Key learning points
- There is a difference between gross and net pay.
- People in different circumstances will have different levels of deductions/allowances.
- Payslips should be checked to ensure deductions are correct.
Common misconception
Gross pay is all the money that you make and get to keep.
Gross pay is your total income but it is not always what you receive. If you earn enough, you will need to pay tax and NI which is deducted from your gross pay.
Keywords
Gross pay - Your gross pay is your total income before any deductions are made.
Net pay - Your net pay is the amount of income that you receive after deductions have been made.
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