Paying Income Tax #9 Percent, multiplication, subtraction, addition Personal Finances care, roads and health and social programs. In the NWT we have both federal tax and Everyone has taxes taken off their pay cheque. Taxes go towards things like health NWT tax. This is how it works for federal tax on all taxable income for the year 2008: . 15% on the first $38,832 .22% on the next 38,832 (on the portion between $38,832 and $77,664) .26% on the next $48,600 (on the portion between $77,664 and $126,264) . 29% over $126,264 The NWT tax is much less (all based on taxable income for the year 2008): 5.9% on the first $36,885 of taxable income 8.6% on the next $36,886(on the portion between $36,885 and $73,771) 12.2% on the next $46,164 (on the portion between $73,771 and $119,935) 14.05% on the amount over $119,936 Laurie makes $45,891 per year. How much is taken off in federal tax? +5 Example: Problem: Solution: Step 1: Calculate 15% of $38,832 (15% = .15) $38,832 x .15 $5824.80 - Step 2: $45,891 $38,832 = $7,059 Step 3: Calculate 22% of $7,059 (22%-.22) $7,059 x .22 $1,552.98 Step 4: Add together: $5,824.80 +1,552.98 = $7,377.78 Laurie has $7,377.78 taken off in federal taxes per year. 2 28 Personal Finances Directions: Answer the problems below about federal and NWT tax. Round your answers to the nearest cent. 1. Susan makes $35,800 per year. a. How much does she pay in federal tax?.. b. How much does she pay in NWT tax? 15,526.84 c. How much is her annual net pay if she also pays $780 in E.L. and $2150 in C.P.P. in one year.? d. What percent of deductions is taken off her yearly salary (including E.I. and C.P.P)? Round your answer to the nearest percent. 2. John makes $87,900 per year. He pays $1550 in E.L. and $3500 in C.P.P in one year. He also pays $670 in health benefits per year. Round your answers to the nearest cent. a. How much does he pay in federal tax? b. How much does he pay in NWT tax? c. How much is his annual net pay? d. What percent of deductions (all deductions including E.I., C.P.P. and health benefits) is taken off his yearly salary? Round your answer to the nearest percent. 3. Joan makes $123,790 per annum. a. How much does she pay in federal tax?. b. How much does she pay in NWT tax? c. How much does she pay in taxes? 3. Joan makes $123,790 per annum. a. How much does she pay in federal tax?.. b. How much does she pay in NWT tax? c. How much does she pay in taxes? d. What percentage does she pay in taxes? Round your answer to the nearest percent. e. How much net pay would she receive if she gets paid every two weeks? 4. Helen makes $45 per hour and she works 37.50 hours per week. a. How much money does she make per year? b. How much does she pay in federal tax?. c. How much does she pay in NWT tax? d. How much does she pay in taxes? e. What percentage does she pay in taxes? Round your answer to the nearest percent.... f. How much net pay would she receive if she gets paid every two weeks