Term 1 · Weeks 1–2 · Earning Money and Percentages

Challenge problem

Challenge

Under the TRAIN tax table, annual taxable income over ₱400,000 up to ₱800,000 is taxed ₱22,500 plus 20% of the excess over ₱400,000. Find the annual income tax on a taxable income of ₱450,000.

Show step-by-step solution

Answer: 32500 ₱

Excess over ₱400,000: $450{,}000 - 400{,}000 = 50{,}000$ .
$20\%$ of excess: $0.20 \times 50{,}000 = 10{,}000$ .
Tax: $22{,}500 + 10{,}000 = 32{,}500$ pesos.

Common errors to watch for

Taxing the whole ₱450,000 at 20% gives ₱90,000; brackets apply only to the excess.

Budget of Work competencies

gm11.t1.w2.c1
Solve problems involving salaries, wages, benefits, and deductions (tax computations, overtime pay, and gross and net incomes) using appropriate technology.