How much more dividend to take out to be tax-efficient?

[Alan @ BroomeAffinity]

Will HMRC start looking closely at the tax returns of director shareholders who receive unusually large dividends in 2015/16 around feb/march time?

Make sure proper paperwork & documents are in place to support the dividend payments just in case HMRC decide to start attacking this area.

Out of interest how will HMRC know there's been unusually high divis in Feb/March time?

[john@UKCA]

Out of interest how will HMRC know there's been unusually high divis in Feb/March time?

from the Related Party Note disclosure in the year end accounts - full details of dividends paid to directors should be shown.

[jamesbrown]

Will HMRC start looking closely at the tax returns of director shareholders who receive unusually large dividends in 2015/16 around feb/march time?

Make sure proper paperwork & documents are in place to support the dividend payments just in case HMRC decide to start attacking this area.

The last point applies under all circumstances.

How would they determine the number, timing or amounts of individual dividends? They only know the total of all dividends received during the tax year (from the SATR). Anyway, this is pretty useless information.

[Alan @ BroomeAffinity]

from the Related Party Note disclosure in the year end accounts - full details of dividends paid to directors should be shown.

And the dates would show how exactly?

[TheFaQQer]

from the Related Party Note disclosure in the year end accounts - full details of dividends paid to directors should be shown.

I've never seen it detailed to the level of which month the dividends were paid. Has my accountant been doing it wrong all these years?

[john@UKCA]

I think it will fairly obvious to HMRC if you show £28,600 net dividend for last year to keep within the basic rate tax band and then say £80K for 2015/16 - sticks out like a sore thumb

[jamesbrown]

I think it will fairly obvious to HMRC if you show £28,600 net dividend for last year to keep within the basic rate tax band and then say £80K for 2015/16 - sticks out like a sore thumb

I think that's an admission you were wrong

On the substantive point, you're speculating. The total amount of dividends paid may be a factor (since it points to a potential liability), and this has some corroboration, but I don't see the value in speculating about what might trigger an investigation. If a dividend is legal, it's legal. The paperwork should be prepared accurately in all cases.

[northernladuk]

Well I guess that brand has pretty much had it's day lol...

[john@UKCA]

The paperwork should be prepared accurately in all cases.

yes all contractors have accurately prepared paperwork for dividends

[TheFaQQer]

@UK Contractor Accountant - can you tell me which company you work for?

Ta