Tax on Dividends

Tax on Dividends

As a director of a company you may decide to distribute company profits to the shareholders – a payment of this kind is called a dividend. However dividends are subject to tax and are determined in relation to the individual’s income band as follows:

Dividend income in relation to the basic rate or higher rate tax bands 2015-16 Dividend tax rate applied after deduction of Personal Allowance and any Blind Person’s Allowance
Dividend income at or below the £31,785 basic rate tax limit10%
Dividend income at or below the £150,000 higher rate tax limit 32.5%
Dividend income above the higher rate tax limit 37.5%

Not paying dividends

If you are looking to not pay dividends you will need to speak to a tax professional to gain tax planning advice as to the best way to extract profit from your limited company. The Sovereign Corporate business opportunity can assist in this.

Call us now
You can reach us on 01273 766399
Send us an email
on info@premierecapital.co.uk