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 of taxable income - %
- on the next of taxable income - %
- on all remaining taxable income - %what tax is due from a UK resident whose income from employment is ?
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
But what I don't understand is where that has come from? Why minus the from their income? (Worried) I know it's probably something really simple, but it's not mentioned anywhere in my notes.