Calculate the amount of tax

[Chikis]

A man's income is N 180 000 per anum. He is allowed a tax-free income in the following: personal allowance N 72 000, child allowance N 4 500 for each child under 18 years for a maximum of 4 children, dependent relatives allowance to a maximum of N 18 000. Calculate the amount of tax the man will pay if has 5 children under 18 years and the taxable income is 10% for the first N 20 000, 15 % for over N 20 000 and up to N 40 000, 20%  for over 40 000 and up to N 60 000, and 25% for over N 60 000. Here is my work:
Man's income = N 180 000
Personal allowance =N 72 000
Child allowance
(4 children maximum) = N 4 x N 4 500 = N 18 000
Dependent relatives allowances = N 18 000

Total tax free allowances:
N 72 000 + N 18 000 + N 18 000 = N 108 000
Taxable income N 180 000 - N 108 000
= N 72 000
To calculate the tax on the taxable income:
N 72 000 = N 20 000 + N 40 000 + N 12 000
Tax rate on the first N 20 000 is 10%  = N 20 000
Tax rate over N 20 000 up to N 40 000 is 15% = N 6000

My problem now is what do I do with the remaining N 12 000 since it is less than N 40 000 and not even over N 65 000? Somebody help me please

 

Edited April 13, 2019 by Chikis

[Intrigued]

2 hours ago, Chikis said:

N 72 000 = N 20 000 + N 40 000 + N 12 000

This line is in error. The first 20,000 is 20,000as you say. From 20,000 t0 40,000 is not 40,000. It is 20,000, and so on.

2 hours ago, Chikis said:

Tax rate on the first N 20 000 is 10%  = N 20 000

10% of 20,000 is not 20,000.

Does that set you back on the right track?

[HallsofIvy]

You include 18000 N for "dependent relatives" but I see nothing that says this man HAS any "dependent relatives"! 

[Chikis]

Quote

10% of 20,000 is not 20,000.

That is an error. I mean  to write ₦2000 and not ₦20 000. Please pardon me for that error.

 

On 4/15/2019 at 1:09 AM, HallsofIvy said:

You include 18000 N for "dependent relatives" but I see nothing that says this man HAS any "dependent relatives"! 

It there in the problem. I copied the the original words in the post i and put the concerned section in bold. You can see it below.

A man's income is N 180 000 per anum. He is allowed a tax-free income in the following: personal allowance N 72 000, child allowance N 4 500 for each child under 18 years for a maximum of 4 children, dependent relatives allowance to a maximum of N 18 000. Calculate the amount of tax the man will pay if has 5 children under 18 years and the taxable income is 10% for the first N 20 000, 15 % for over N 20 000 and up to N 40 000, 20%  for over 40 000 and up to N 60 000, and 25% for over  ₦60 000.

Have you seen it?

[Intrigued]

On 4/13/2019 at 3:31 AM, Intrigued said:

This line is in error. The first 20,000 is 20,000as you say. From 20,000 t0 40,000 is not 40,000. It is 20,000, and so on.

Do you understand that the point I made above is the root of your error?