Dividend tax question - Urgent

[bluedrop]

hi,
Can someone please help me understand the taxes involved in the below circumstances?

Perm employment until Dec2014 - Salary 63k

Contract from Jan2015 (via a new ltd company or joining partners company as a director)

How much can be withdrawn from the company as dividends (for year ending april 2015) without paying any further personal tax?

[Louisa@InTouch]

If your employment income for the year has already exceeded the higher rate threshold for 2014/15 (£41,865, assuming you have a standard personal allowance of £10,000).

Then any dividends that you take from a Limited company between now and 05/04/2015 will be subject to personal tax implications.

You will pay 25% on the net dividends until your total gross income exceeds £150,000. If you go over this, then the taxes increase to 36.1% on the net dividends.

However you could consider a director loan of up to £10,000 in the tax year with no benefit in kind implications and repay this with a dividend in the new tax year. Or defer your dividend payments if possible until after 06/04/2015 when the new tax year starts.

[VectraMan]

None. Zero. Zilch. Nada.

Don't pay any salary either. Leave it until April.

[bluedrop]

Thanks a ton for your inputs Louisia and Vectraman!!

[TheCyclingProgrammer]

If you don't need the money and have good savings, then think of this as a good opportunity to build up a healthy warchest.

[Alan @ BroomeAffinity]

Contract from Jan2015 (via a new ltd company or joining partners company as a director)?

Probably better with your own new ltd co rather than joining your partner's.

[Martin at NixonWilliams]

You will pay 25% on the net dividends until your total gross income exceeds £150,000. If you go over this, then the taxes increase to 36.1% on the net dividends.

The effective rate of tax on net dividends declared above the additional rate threshold is 30.56%.

The 36.1% referred to above ended in 2012/13.

[JB3000]

The effective rate of tax on net dividends declared above the additional rate threshold is 30.56%.

The 36.1% referred to above ended in 2012/13.

Nixon Williams 1 - Intouch 0 (full time)

[jmo21]

Nixon Williams 1 - Intouch 0 (full time)

"Nixon Williams wins with a knockout in the first round" would be a more appropriate analogy.

[JB3000]

"Nixon Williams wins with a knockout in the first round" would be a more appropriate analogy.

Not really- a heavy weight and a light weight should never be in the same ring together.