Work, income and deductions
Lesson details
Learning outcome
I can estimate and calculate take home pay for different occupations and for people in different circumstances.
Key learning points
- There is a difference between gross and net pay.
- People in different circumstances will have different levels of deductions/allowances.
- Payslips should be checked to ensure deductions are correct.
Keywords
Gross pay - Your gross pay is your total income before any deductions are made.
Net pay - Your net pay is the amount of income that you receive after deductions have been made.
Common misconception
Gross pay is all the money that you make and get to keep.
Gross pay is your total income but it is not always what you receive. If you earn enough, you will need to pay tax and NI which is deducted from your gross pay.
Teacher tip
Pupils could use spreadsheet software so that they can quickly calculate new pay from various incomes.
Content guidance
Depiction or discussion of sensitive content
Supervision
Adult supervision recommended
Licence
Lesson video
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Prior knowledge starter quiz
6 Questions
Q1. Tax is tax that you pay on your income.
Q2.National is a tax on income which qualifies you to certain benefits, such as the State Pension and maternity pay.
Q3. Tax (VAT) is a tax that is added to most products and services sold by businesses.
Q4.The amount of money you can earn without having to pay Income Tax is called your ...
Q5.A store in the USA has a pair of sneakers on display. The price tag reads $31.99 and the Sales Tax is 15%. What do the sneakers cost?
Q6.A shop in the UK has a pair of trainers on display. The price tag reads £55.99 and VAT is 20%. What do the trainers cost?
Assessment exit quiz
6 Questions
Q1.An employee works 168 hours in a month and is paid £23.50 per hour. What is their gross pay?
Q2.An employee works 152 hours in a month and is paid £29.50 per hour. What is their gross pay?
Q3.An employee works 168 hours in a month and is paid £23.50 per hour. Their pension contribution is 5% of their gross pay. Calculate their pension contribution for this month.
Q4.An employee works 152 hours in a month and is paid £29.50 per hour. Their pension contribution is 6% of their gross pay. Calculate their pension contribution for this month.
Q5.One month, an employee is left with a taxable income of £3750. The first £1048 earned is tax-free and then up to the next £3141 is taxed at 8%. How much of the taxable income is taxed at 8%?
Q6.One month, an employee is left with a taxable income of £3750. The first £1048 earned is tax-free and then up to the next £3141 is taxed at 20%. How much tax is owed?
To help you plan your 11 financial education lesson on: Work, income and deductions, download all teaching resources for free and adapt to suit your pupils' needs...
To help you plan your 11 financial education lesson on: Work, income and deductions, download all teaching resources for free and adapt to suit your pupils' needs.
The starter quiz will activate and check your pupils' prior knowledge, with versions available both with and without answers in PDF format.
We use learning cycles to break down learning into key concepts or ideas linked to the learning outcome. Each learning cycle features explanations with checks for understanding and practice tasks with feedback. All of this is found in our slide decks, ready for you to download and edit. The practice tasks are also available as printable worksheets and some lessons have additional materials with extra material you might need for teaching the lesson.
The assessment exit quiz will test your pupils' understanding of the key learning points.
Our video is a tool for planning, showing how other teachers might teach the lesson, offering helpful tips, modelled explanations and inspiration for your own delivery in the classroom. Plus, you can set it as homework or revision for pupils and keep their learning on track by sharing an online pupil version of this lesson.
Explore more key stage 4 financial education lessons from the Salaries and long term financial planning unit, dive into the full secondary financial education curriculum, or learn more about lesson planning.