Answer to Question #278366 in Financial Math for james

Question

From the information below concerning an employed Kenyan on a pension scheme, calculate the gross pay, chargeable pay, tax charged and PAYE for the individual (Clearly explain and show your workings)

Description AMOUNT

Basic Pay 163,562

ALLOWANCE

Housing Amount 139,675

Commuting Allowance 10,000

Gross Pay ???

TAX CALCULATIONS

Defined Contributions 200

Provident Fund 16,356.2

Taxable Pay ???

Tax Charged ???

Personal Relief 1,408

STATUTORIES

N.S.S.F 200

N.H.I.F 1,700

P.A.Y.E ???

Answer 1

Gross pay=Basic pay + allowances

=163562+139675+10000

=313237

Taxable pay = 313237

from tax distribution table below:

Taxable income rate(for every 20 shilling)

1-75480 2

75430-150960 3

150961-226440 4

226441-301920 5

301921-377400 7

first bracket- 2/20*75480= 7548

second bracket- 3/20*75480=11322

third bracket - 4/20*75480= 15096

fourth bracket- 5/20*75480= 18870

fifth bracket-(313237-301920= 11317

7/20*11317= 3690.95

Tax charged= 7548+11322+15096+18870+3960.95

= 56796.96- 1408(personal relief)

= 55388.95

Net salary =Basic salary +(allowances-deductions)

= 313237-(55388.95+200+16356.2+200+1700

=313237-73845.15

=239391.85