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income tax
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do I know...
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what is meant by ‘income tax’?
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how much I will have to pay? |
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how income tax is paid?
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what happens to the money collected? |
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what benefits I will receive by paying income tax?
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where to find more information about income tax?
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case study
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Amisha is 26 years old and works full-time earning £15,000 a year. She is a tenant and rents a house, but wanted to rent a room in it out to a friend. She has checked this with the letting agency who agreed, but they warned her she would have to pay tax on the extra income. She wanted to know whether this was true. CAB advised her that the first £4,250 of any income received from letting is usually exempt from income tax under the Rent-a-Room scheme.
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The scheme applies to anyone who is an owner or tenant occupier and is renting out a room in their home. Under this scheme any income which the landlord receives, for example, for rent andlor services like meals or laundry up to £4,250 is exempt from Income Tax. Anything over the £4250 is taxable.
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