Okay, so this is an example taken from my notes on finance, and I just don't understand it. The question goes...

*If the rate of tax on income from employment or self-employment in the UK is currently as follows...*

*on the first $\displaystyle \pounds2020$ of taxable income - $\displaystyle 10$%*

*on the next $\displaystyle \pounds29,380$ of taxable income - $\displaystyle 22$%*

*on all remaining taxable income - $\displaystyle 40$%*

*what tax is due from a UK resident whose income from employment is $\displaystyle \pounds40,935$?*

Now I do understand that, but then in the solution on the next page it says

*Assuming there are no other allowances or taxable earnings, the taxable income is $\displaystyle \pounds40,935-\pounds4,895=\pounds36,040$*

But what I don't understand is where that $\displaystyle \pounds36,040$ has come from? Why minus the $\displaystyle \pounds4,895$ from their income? (Worried) I know it's probably something really simple, but it's not mentioned anywhere in my notes.