Example (1): Ben has business profits of 109,520 in 2016-17. He has no other income for the year and claims no tax reliefs. He makes no Gift Aid donations or pension contributions. Besides that, the basic personal allowance for that year is 11,000.

Calculate:

i) The amount of his 2016-17 personal allowance given his net adjusted

income based and the provided income.

ii) The amount of his 2016-17 personal allowance given his net adjusted income if a 100 increase in his profits.

(iii) Show how a 100 increase in his profits would result in an increase of 60 in the income tax liability for the year the year if the tax rate is 20% for the first 32,000, and 40% for the remaining amount.