COMPUTING DEDUCTIONS & NET PAY

Class Tutorial Worksheet

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1. Calculating gross monthly pay: Maseo is the manager of a retail store. His gross
annual salary for 2018 was $1,420,000. In 2019 his gross annual salary was increased
by 5% on the figure for 2018. Calculate Maseo’s gross monthly salary for:
: (i) 2018
(ii) 2019
2. Calculating gross pay based on time rates. Giselle works on the production line in a
local factory. Gisselle is expected to work and eight-hour day shift and is paid $580 per
hour. Overtime is paid at time and a quarter (1 ½). The lunch hour is included in the
normal working hours. For the week ended 18 October 2019, Giselle’s time card was as
follows:
MORNING AFTERNOON EVENING
DAYS IN OUT IN OUT IN OUT
Monday 8:00 12:30 13:30 4:00 6:00 7:30
Tuesday 8:00 12:30 13:30 4:03
Wednesday 8:00 12:30 13:30 4:04 6:00 8:30
Thursday 8:00 12:30 13:30 4:01
Friday 8:00 12:30 13:30 4:01

Calculate Giselle’s gross pay for the week ended 12 October 2019.
3. Calculating gross pay based on piece rates. Vernon works full-time in a factory. He is
paid $16 for each product that is accepted. The business operates on a minimum wage
agreement. For Vernon, this means he must be paid at least $9000 per week. During the
week ended 18 October 2019, Vernon’s piecework ticket showed that he had 562
products accepted. During the week ended 25 October 2019, his piecework ticket was
as follows:

Number Produced Number Rejected Number Accepted

Monday 128 6
Tuesday 122 8
Wednesday 121 3
Thursday 119 5
Friday 121 7
Total 710 27

Calculate:
(a). Vernon’s pay for the week ended 18 October 2019
(b). the total number of items accepted during the week ended 25 October 2019
(c). Vernon’s pay for the week ended 25 October 2019
 4. Calculating net pay after statutory deductions. Celina’s annual gross pay is
$986,000. She is entitled to a personal allowance of $90,000 for the year.

Income tax is charged at 25% of taxable pay. In addition, Celina is required to pay NIS
Contribution of 2.5%, NHT payment of 2% Education Tax of 2.25% and a pension plan
contribution of 4% of her gross pay. Assuming the annual income tax threshold is
$880,500.

You are required to calculate:

(a). Celina’s annual statutory income (b). Celina’s annual taxable income
(c). income tax charged on Celina’s annual salary (d). Celina’s annual net pay
(e). Celina’s monthly net pay

ANNUAL CALCULATIONS DEDUCTIONS

Gross Pay $0

Less Pension Contribution (if applicable)

Less NIS (2.5%)

Statutory Income

Education Tax (2.25% of statutory Income)

NHT (2% of Gross Pay)

Less Income Tax Threshold

Taxable Income

Income Tax (25%)

Net Pay
MONTHLY CALCULATIONS DEDUCTIONS

Gross Pay $0

Less Pension Contribution (if applicable)

Less NIS (2.5%)

Statutory Income

Education Tax (2.25% of statutory Income)

NHT (2% of Gross Pay)

Less Income Tax Threshold

Taxable Income

Income Tax (25%)

Net Pay