As an owner manager, have you declared all the dividends you are going to take for this year?
Remember, you don’t pay tax on the first £5,000 of dividends you get in the tax year.
If you have no other sources of income, this £5,000 will be in addition to the £11,500 personal allowance. So you could receive up to £16,500 tax free in dividends from your company.
From 6th April 2018, the dividend allowance will drop to £2,000, so this is your last chance to get that extra £3,000 tax-free.
Dividends in excess of the £5,000 dividend allowance are taxed at 7.5% basic rate, 32.5% higher rate and 38.1% additional rate. Dividend rates are still lower than the rates for salary income.
If you have any questions or queries, please do not hesitate to contact SFB’s Tax team by emailing firstname.lastname@example.org.