Tax Law
A solicitor earned a salary of £110,140 in a tax year, with a basic personal allowance of £12,570 for this year.
What is the amount of personal allowance a solicitor can claim?
A solicitor earned a salary of £110,140 in a tax year, with a basic personal allowance of £12,570 for this year.
What is the amount of personal allowance a solicitor can claim?
£7,500
(D) The current tax-free personal allowance is £12,570. However, if gross income is above £100,000, the allowance reduces by £1 for every £2 earned above that threshold. In this case, a solicitor's income is £10,140 above £100,000, resulting in a reduction of £5,070 in their tax-free allowance.
Therefore, their tax-free allowance would be £7,500 (£12,570 - £5,070).
166 of 230