50k spare

[contractor79]

I have 50k retained profit sitting in a bond in company account
I pay myself 40k each year in divs and salary, then £10-12k pension from company

I've thought about keeping 50k there just in case out of contract to pay myself 40k sal, divs + 10k pension for 12 months

but if I contract ends I probably won't need to pay myself that much as I would move in with parents until another contract comes along

so can someone tell me how much tax I'm gonna have to pay to pull this 50k out this tax year? is it 32.5% * £50,000 = £16,250? and when would that tax be due? or is it 22.5% * 50k = 11250

[Fred Bloggs]

Put £50k in a SIPP. Then, if you're >50 immediately draw out £12.5k tax free. Buy £12.5k of bombed out building co shares in two ISAs with your partner, say Taylor Wimpey, for example. Sit back for 3 or 4 years and when the shares quadruple, voila, £50k tax free plus you have a SIPP! Job done

[contractor79]

Put £50k in a SIPP. Then, if you're >50 immediately draw out £12.5k tax free. Buy £12.5k of bombed out building co shares in two ISAs with your partner, say Taylor Wimpey, for example. Sit back for 3 or 4 years and when the shares quadruple, voila, £50k tax free plus you have a SIPP! Job done

Ok, but thought I had to be 55

[QwertyBerty]

The latter. If you take the dividend now you pay won't need to pay for another year or so.

http://www.direct.gov.uk/en/MoneyTax...nts/DG_4016453

QB.

[contractor79]

The latter. If you take the dividend now you pay won't need to pay for another year or so.

http://www.direct.gov.uk/en/MoneyTax...nts/DG_4016453

QB.

so 11250 of the 50k will go in tax
not bad actually

[Fred Bloggs]

Ok, but thought I had to be 55

From 2010. Until then, it's 50. HTH.

[ASB]

so 11250 of the 50k will go in tax
not bad actually

It's 25% of the net dividend. 22.5% of the gross. Remember the tax credit. So the tax is 12.5k.

[contractor79]

It's 25% of the net dividend. 22.5% of the gross. Remember the tax credit. So the tax is 12.5k.

ok thanks