The following tax rates and allowance are to be used in answering the questions.

income tax Normal rates Dividend rates

Basic rate 1-37,500 20% 7.5%

Higher rate 37,501-150,000 40% 32.5%

Additional rate 150,000 and over 45% 38.1%

Saving income nil rate Band-Basic rate taxpayer 1,000

Higher rare taxpayers 500

Dividend nil rate band 2,000

A starting rate of 0% applies to saving income where it falls within the first 5,000 of taxable income.

Question

A computer programmer. Until 5 April 2020 she was employed by computer plc but since then has worked independently from home. The programmer income for the year ended 5 April 2021 is 60,000. All of this relates to work done for Net Computer plc. The programmer expenditure for the year ended 5 April 2021 is as follows:

1. The business proportion of light, heat and telephone for Nana's home is 880

2. A motor car was purchased the programmer on the 6 April 2020 for 10,000 with co2 pf 105g/km. Motor expenses for the year ended 5 April 2021 amount to 3500 of which 40% relates to journeys between home and the premises of Net Computers Plc. The other 60% relates to private mileage.

Required

i) Calculate the amount of taxable trading profit if Nana is treated as self-employed during 2020/21

ii) Calculate the amount of Nana's taxable earnings if she is treated as an employee during 2020/21