Quote:
Originally Posted by Raju  Dividends are taxed at 10% for a basic rate taxpayer.
It's corporation tax which is 19%, which are excess profits of your Ltd company, only payable over £10k. |
Dividends are taxed at 10% for anything below the higher rate (approx £40 000 ), however whilst in the basic rate, you do not pay dividend tax.
Golden Brown has made this complicated though: the dividends are "grossed up" by 10% (multiply by 10/9) and then 10% is taken off them (x9/10).. so paying a dividend of £10.00 per share on the 100 ordinary shares of £1.00 is as follows:
Shareholding Tax Credit Dividend Payable
100 £111.11 £1000.00
Regards
wwjd_andy