The owners of the business for which you work want to invest some money. They are unsure whether they should put the money in an investment account with 8% compounding interest for a fixed term of six years and have asked you to calculate the amount that they would get at the end of the investment.

They are investing their own money and the returns will be subject to income tax even though the money will not be withdrawn until the end of the investment period. The amount to be invested is $500,000 and the owners are in the top tax bracket.

Requires: Using these tax table below: i) Calculate the amount that the investment will return at the end of the period.

ii) The Total Tax and Medicare levy that will be paid to the nearest dollar that will arise from the investment.

iii) Calculate the total amount of money that they will receive from the investment after tax and the Medicare levy has been paid.

Resident Income Tax Rates from 1 July 2018 (not including Medicare Levy of 2%)

axable Income	Tax on this Income
0 $18,200	Nil
$18,201 $37,000	19c for each $1 over $18,200
$37,001 $90,000	$3,572 plus 32.5c for each $1 over $37,000
$90,001 $180,000	$20,797 plus 37c for each $1 over $90,000
$180,001 and over	$54,097 plus 45c for each $1 over $180,000