Rich/Tight contractors?

[SeededLoaf]

One divi on the 6th April then wait a whole 12 months. Rest goes into pension and business saving accounts.

I live on a £7k salary and travel expenses.

[vwdan]

I just take dividends whenever I feel like it

[henryhooverville]

I am not a contracter per se but...

My understanding of the tax system, from years of Money Box on radio, is that dividends can be really flexible in terms of when they arrive (monthly, bi/tri, 6 or 12 months etc.) however the tax implications can change.

For example a monthly dividend could be treated as a standard income when being assessed, quarterly is an option if you prefer near-constant payments and is more business like but still a compromise. Yearly dividends are the most popular and you'll find that it's used on most type B shares.

Now things get interesting if you are a listed company, in that the business can 'own' its own shares and not have to pay a dividend to itself (that would be odd) but to shareholders yes. I think small enterprises can claim EIS tax relief so investors don't have to pay income tax on those dividends.

That's all I really know, it depends on how you want your self-assessments to look if other people glance at it. I'd wager every six months is a fair compromise and it looks like standard dues to an investor than say a monthly dividend would.

I'm not a tax man, I am in fact what you'd define a kid (19 years old), and a taxman/accountant is best suited to look at your particular needs as a business/household. Hope this helps (?)

[SueEllen]

My understanding of the tax system, from years of Money Box on radio, is that dividends can be really flexible in terms of when they arrive (monthly, bi/tri, 6 or 12 months etc.) however the tax implications can change.

For example a monthly dividend could be treated as a standard income when being assessed, quarterly is an option if you prefer near-constant payments and is more business like but still a compromise. Yearly dividends are the most popular and you'll find that it's used on most type B shares.

Now things get interesting if you are a listed company, in that the business can 'own' its own shares and not have to pay a dividend to itself (that would be odd) but to shareholders yes. I think small enterprises can claim EIS tax relief so investors don't have to pay income tax on those dividends.

That's all I really know, it depends on how you want your self-assessments to look if other people glance at it. I'd wager every six months is a fair compromise and it looks like standard dues to an investor than say a monthly dividend would.

I'm not a tax man, I am in fact what you'd define a kid (19 years old), and a taxman/accountant is best suited to look at your particular needs as a business/household. Hope this helps (?)

It doesn't.