1. **State the problem:** Calculate Mr. Clarke's tax payable based on his taxable income of $58,000 using the given tax rates, then determine if he owes money or is due a refund given the $12,000 tax deducted by his employer. 2. **Tax rates and formula:** - Tax on first $50,000 = 12.5% of $50,000 - Tax on amount over $50,000 = 28.5% of (Taxable Income - $50,000) 3. **Calculate tax payable:** - Tax on first $50,000 = $50,000 \times 0.125 = 6250$ - Amount over $50,000 = $58,000 - $50,000 = 8,000$ - Tax on excess = $8,000 \times 0.285 = 2280$ - Total tax payable = $6250 + $2280 = 8530$ 4. **Compare tax payable with tax deducted:** - Tax deducted by employer = 12,000$ - Since $12,000 > 8,530$, Mr. Clarke has overpaid tax. - Refund amount = $12,000 - 8,530 = 3,470$ 5. **Conclusion:** - Tax payable = 8,530$ - Mr. Clarke should be refunded 3,470$ **Final answer:** Option a is correct.