The Chief Examiner reported that although this question was attempted by majority of the candidates, their performance was poor. Candidates were encouraged to read the questions carefully before answering them so that they can appreciate its demand(s).
Candidates were expected to respond as follows:
Total tax free allowance = 120 + 30 + (25 × 4) + 40 =GH¢ 290.00
Therefore, taxable income = GH¢ (850 – 290) = GH¢ 560.00.
The tax would be deducted as follows:
From the first GH¢ 200.00, tax = × 200 = GH¢ 20.00. From the next GH¢200.00, tax = × 200 = GH¢ 30 .00. Remaining taxable income = GH¢(560 – 400) =GH¢ 160.00. Therefore, tax on GH¢ 160.00 = × 160 = GH¢ 32.00. Total annual tax = 32 + 30 + 20 =GH¢ 82.00. The monthly tax was then obtained as = GH¢ 6.83