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GCSE Business · key term
Income remaining after income tax and other compulsory deductions, available to spend or save.
Used by Edexcel and OCR
Specification 1.5.4 · Paper 1
Revise: The Economy and BusinessDisposable income is income left after income tax and other compulsory deductions. Consumers can spend or save it. Changes in this income affect both how much they buy and which products they choose.
Paper 2
Income remaining after income tax and other compulsory deductions, which consumers can spend or save. Essential living costs use up part of this income.
Revise: Impact of Economic ClimateDisposable income is what remains after income tax and other compulsory deductions. Consumers use this money to meet essential living costs, buy other goods and services, or save.
Distinguish a tax on company profits from a tax on customer income: corporation tax affects profit available after tax; income tax affects customers’ disposable income.
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