Where you are a company Director of ltd you have the option of delaying the payment of salary and dividends.
Dividends are only taxed when they are paid and you can manage both the timing and the amount of your personal tax liabilities.
Above this allowance the tax you pay depends on which Income Tax band you are in. Add your income from dividends to your other taxable income when working this out. You may pay tax at more than one rate.
If you are likely to sell a business interest or asset in the next 12 to 24 months 18u should ensure you qualify for Entrepreneurs’ Relief. This can save you up to 18% on capital gain tax.
Director’s Loan Account
This is a popular form of remuneration for director/shareholders. However they can give rise to an income tax charge of the Director and also tax liabilities for the company.
Ensure that the loan is repaid within 9 months of the end of the accounting period in which funds were withdrawn otherwise a further charge to tax of 25% will arise on the company.