The dividend tax-free allowance has been reduced from £5,000 to £2,000 from 6th April 2018 after the Chancellor, Philip Hammond announced this last year in the 2017 Budget.
The significant decrease in the tax-free allowance will affect employees and directors of small businesses who are paid wholly or partly through dividends as opposed to a salary.
For dividends above £2,000, the tax you pay is based on your tax band (marginal tax rate). The different dividend tax rates are:
Income tax band
Basic rate 7.5%
Higher rate 32.5%
Additional rate 38.1%
For those receiving more than £10,000 in dividends you will need to complete a Self Assessment.
If you require further information on this or require assistance then call us on 0113 2864486.
Our Services
-
Business Growth
If you are looking for your business to grow, and it has the potential to do so, there is every chance you will accelerate that growth by working with a growth coach. Growing can be painful, there will be hurdles to overcome and changes to be made.
-
Company Year End
The legal and compliance burden put on businesses through the need to submit tax returns and other such documents to strict deadlines is often one of the most stressful elements of running a business.
Pop in or give us a call
We'd love to hear from you
When it comes to supporting small enterprises, helping them grow whilst avoiding regulatory and commercial pitfalls, we have a weath of experience, expertise and a kettle - a very good kettle. If you think we could be a good fit, get in touch to see how we can add value to your business.
Contact
About us