Tx notes fa22 Final

June 2023 to March 2024 exams
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Note 1:
The 0% starting rate for savings income is not available as non savings taxable income exceeds 
£5,000.
Kate is a higher rate taxpayer so has a £500 nil rate band. The savings income nil rate band counts 
towards the basic rate band limit.
Note 2: 
The dividend income nil rate band is £2,000 no matter what other income of the taxpayer exists and 
counts towards the basic rate band limit. The remaining dividend income uses the remaining basic 
rate band and the balance falling in the higher rate band is taxed at 33.75%.

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June 2023 to March 2024 exams
Watch free ACCA TX lectures
2. Jessica 
Jessica Income tax computation 2022/23:
(W2)
37,700 + 2,000 = 39,700
150,000 + 2,000 = 152,000
Note 1: 
Jessica is a higher rate taxpayer, so has a £500 savings income nil rate band.
The starting rate for savings income is not available as non-savings taxable income exceeds £5,000.
Non 
savings
Savings
Total
£
£
£
Trading profit
90,000
90,000
Bank interest
20,000
20,000 
Total income
90,000
20,000
110,000
Less Personal allowance (W1)
(8,570)
(8,570)
Taxable income
81,430
20,000
101,430
Income Tax: 
Non-savings:(W2)
39,700 @ 20% =
7,940
41,730 @ 40% = 
16,692
81,430
Savings (note 1) 500 @ 0%
0
19,500 @ 40%
7,800