# The table below shows the income tax rates for a certain year

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The table below shows the income tax rates for a certain year

 Monthly taxable income in Ksh. Tax rate percentage (%) in each shilling 1 - 11,180 10 11,181 - 21,714 15 21,715 - 32,248 20 32,249 - 42,782 25 Over 42,782 30
1. During the year, Moraa's monthly income was as follows:
Basic salary Ksh 40,000
House allowance Ksh 11,090
Commuter allowance Ksh 7,000
Calculate:
• Moraa's total monthly taxable income.
• total income tax charged on Moraa's monthly income.
2. Moraa's net monthly tax was Ksh 10,750.80.
Determine the monthly tax relief allowed.
3. A proposal to expand the size of the first income tax band by 50% while retaining the size of the next three bands was made. The tax rates would remain as before in each band.
Using the proposal, calculate:
• the tax Moraa would pay in the first band.
• the tax Moraa would pay in the last tax band.

selected

1.
1. total income = BS + allowances
= 40,000 + 11,090 + 7,000
=Ksh 58 090 per month
2. 11,189 x 10% =1,118
10,534 x 15% =1,580.1
10,534 x 20% = 2,106.8
10,534 x 25% = 2,633.5
Bal =58,090 - 42,782=15,308
15308 x 30% = 4,592.4 + gross tax =12,030.80
= Ksh 12 030.80
2. relief= gross tax − net tax
= 12,030.80 − 10,750.80
= 1 280
3.
1. 11,180 x 150% x 10%=16,770 x 10% = 1,677
2.         1 − 16,770     10%
16,771 − 27,304     15%
27,305 − 37,838     20%
37,839 − 48,372     25%
over 48,372     30%
(58,090 − 48,372) x 30% = 2,915.40