Question

Case Study: 5

Tom is a boarding school teacher at Wallington School and as per boarding school requirements, he need to live in a house in the school grounds. The value of the house provided for his accommodation is costs £85,000 with an annual value is £1,250. School paid an electricity bill of £300, a gas bill of £200, a gardener’s bill of £1,000 and a redecoration costs £1,500 in the current year. Tom makes a monthly contribution of £100 for his accommodation and other bills. He earns a gross salary of £30,000 per annum and make an occupational pension contribution of £2,000 per annum.

You are required to calculate Tom’s taxable employment income and tax liability as per UK Tax Laws 2018/19.

Answer 1

Being a boading schoole teacher, Tom needs to live at Shcool premises thus he qualifiies for accomodation as non taxable allowances.

	Amount in GBP
Tom's annual Salary	30,000
Pension Contribution	(2,000)
Taxable Income	28,000
Basic Slab for Income tax for GBP 11,851 to GBP 46350 @ 20%
Tax amount	3,230