The disadvantage of overpaying your taxes during the year is that you cannot use the money or draw interest on it until after you get your tax refund.

If you are overpaying your taxes, the government is holding that extra money for you. At the end of the tax year when you file your taxes, they will give you the extra money back that you overpaid.

However, you don't receive any interest on the extra money that was held.

5 0

3 years ago

Briony invests some money. Interest is paid on the money at a rate of 2% per annum for the first year and 1% per annum for the s

nalin [4]

Answer:

Brionny invested £8400.

Step-by-step explanation:

Simple Interest

This is a simple interest problem.

The simple interest formula is given by:

$E = P*I*t$

In which E is the amount of interest earned, P is the principal(the initial amount of money), I is the interest rate(yearly, as a decimal) and t is the time.

After t years, the total amount of money is:

$T = E + P$

In this question:

We divide in two intervals, the first year and the second year. We have to know that the amount after the end of the first year is the principal at the start of the second year.

First year:

Amount of 2% interest, during 1 year.

So the interest earned is:

$E = P*I*t = P*0.02*1 = 0.02P$