Originally posted by Jessica@WhiteFieldTax
View Post
- Visitors can check out the Forum FAQ by clicking this link. You have to register before you can post: click the REGISTER link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. View our Forum Privacy Policy.
- Want to receive the latest contracting news and advice straight to your inbox? Sign up to the ContractorUK newsletter here. Every sign up will also be entered into a draw to WIN £100 Amazon vouchers!
Reply to: Dividend Tax / Self Assessment
Collapse
You are not logged in or you do not have permission to access this page. This could be due to one of several reasons:
- You are not logged in. If you are already registered, fill in the form below to log in, or follow the "Sign Up" link to register a new account.
- You may not have sufficient privileges to access this page. Are you trying to edit someone else's post, access administrative features or some other privileged system?
- If you are trying to post, the administrator may have disabled your account, or it may be awaiting activation.
Logging in...
Previously on "Dividend Tax / Self Assessment"
Collapse
-
-
Originally posted by craigy1874 View PostIm a tax advisor of 18 years and its the first year it has ever been beneficial!
Leave a comment:
-
Im a tax advisor of 18 years and its the first year it has ever been beneficial!
Leave a comment:
-
I think your wires are slightly crossed.
It isn't the fact you can tax income in whatever order you like, it is that you can offset your personal allowance against whichever income gives you the best financial outcome.
The norm is to offset PA against salary first, but with the new dividend tax it can sometimes be better to set it against higher rate dividends first, rather than basic rate salary.
I think this is probably what your accountants are referring to.
You've hit the nail on the head craigy1874
Yes they've made it a bit clearer now that this is what they are doing. Having the choice between offsetting PA against salary or dividend first is a lesson for me.
Leave a comment:
-
Dividends
Dividends and investment income form the top slice of the tax calculation, so take all your income then add the dividends on top.......then any dividends that fall into higher rate would be taxed at 32.5%
Leave a comment:
-
I think your wires are slightly crossed.
It isn't the fact you can tax income in whatever order you like, it is that you can offset your personal allowance against whichever income gives you the best financial outcome.
The norm is to offset PA against salary first, but with the new dividend tax it can sometimes be better to set it against higher rate dividends first, rather than basic rate salary.
I think this is probably what your accountants are referring to.
Leave a comment:
-
Invest GBP 25 in TaxCalc and do your own self assessment return, then if your accountant is wrong, complain and get the GBP 25 off them as compensation.
Leave a comment:
-
And I thought the order was whichever provided most money to HMRC....
Leave a comment:
-
Dividend tax
As said above, dividends are top slice as explained in the HMRC guidance 'Add your income from dividends to your other taxable income ':
https://www.gov.uk/tax-on-dividends
Hopefully this helps.
Leave a comment:
-
Have a look at 68-71 here
http://www.sa2000.co.uk/2017-exc-indi.pdf
I can’t find where this is in HMRCs website, they themselves link out to it. https://taxagents.blog.gov.uk/2017/0...oints-meeting/
It’s become far too complex.
Leave a comment:
-
Thanks Chopper for pointing out Top Slice as the keyword to search for.
Still.....confusing search results
I came across this which supports what the accountant is saying.......good news :-)
www.rossmartin.co.uk/directors/tax-efficient-remuneration/1591-summer-budget-2015-dividend-tax#overview-and-examples
under the heading "Alternative version to HMRC's Example 6"
Whereas a number of other sites say the opposite
Income tax rates and taxable bands and order of taxation
Confusing ???Last edited by PTP; 5 January 2018, 22:55.
Leave a comment:
-
Dividend Tax / Self Assessment
I've not got much faith in my accountants after the mistakes I've seen them make.
I'll be changing accountant after year-end, but in the meantime I wanted to check with you guys about their personal tax calc.
They say that dividends and salary can be taxed it whichever order you wish i.e. its up to you which one uses up each of the tax allowances/bands and this allows you to arrange things in the most tax efficient order.
Whereas the 2 online calculators I've used both do it in a fixed order of salary then dividends
Plus Example 6 on this HMRC factsheet shows salary being taxed first.
www.gov.uk/government/publications/dividend-allowance-factsheet/dividend-allowance-factsheet
Are the accountants right that you can just tax things in whichever order you want?
ThanksLast edited by PTP; 5 January 2018, 19:26.Tags: None
- Home
- News & Features
- First Timers
- IR35 / S660 / BN66
- Employee Benefit Trusts
- Agency Workers Regulations
- MSC Legislation
- Limited Companies
- Dividends
- Umbrella Company
- VAT / Flat Rate VAT
- Job News & Guides
- Money News & Guides
- Guide to Contracts
- Successful Contracting
- Contracting Overseas
- Contractor Calculators
- MVL
- Contractor Expenses
Advertisers
Contractor Services
CUK News
- Streamline Your Retirement with iSIPP: A Solution for Contractor Pensions Sep 1 09:13
- Making the most of pension lump sums: overview for contractors Sep 1 08:36
- Umbrella company tribunal cases are opening up; are your wages subject to unlawful deductions, too? Aug 31 08:38
- Contractors, relabelling 'labour' as 'services' to appear 'fully contracted out' won't dupe IR35 inspectors Aug 31 08:30
- How often does HMRC check tax returns? Aug 30 08:27
- Work-life balance as an IT contractor: 5 top tips from a tech recruiter Aug 30 08:20
- Autumn Statement 2023 tipped to prioritise mental health, in a boost for UK workplaces Aug 29 08:33
- Final reminder for contractors to respond to the umbrella consultation (closing today) Aug 29 08:09
- Top 5 most in demand cyber security contract roles Aug 25 08:38
- Changes to the right to request flexible working are incoming, but how will contractors be affected? Aug 24 08:25
Leave a comment: