DO YOU HAVE TO PAY TAX ON DIVIDENDS (UK)?

[@1357mike10]

Thank you very much for this information. Mike

[@HeelanAssociates]

No problem!

[@lawrencer25]

Fabulous video ❤

[@HeelanAssociates]

Glad you enjoyed!

[@evka24]

Thank you

[@HeelanAssociates]

You're welcome

[@stevenlong2177]

Hi, what tax rate is applied to retained profits when a Ltd company is shut down? (e.g. non-declared dividends).

[@HeelanAssociates]

Depends how the cash ‘comes out’. Often owners may choose to liquidate the company at the end and see a return of their capital, which can often be at 10-20% (conditions apply). Otherwise the income will generally be subject to usual income taxes when withdrawn before being dissolved (otherwise money goes to the crown).

[@NenadNikolic]

Hi, for non residents, all income outside of UK, are corporate and dividend tax zero (all tax) ? Can be payed out each month completely as dividend?

[@HeelanAssociates]

Difficult question to answer me in comment sadly, particularly when talking about the corporate tax. You certainly can have situations where UK isn’t taxing that income, but it’s so situational.

[@evka24]

Can you be the only one director and as well only one shareholder in the company or there must be more than one? Thank you

[@HeelanAssociates]

Yup fine to be the only one and be both. (Very common).

[@philipashton1443]

How do you pay the dividend tax if you're over the allowance and you're working for someone else ?

[@HeelanAssociates]

Inside a personal tax return.

[@Jonnyicey]

Is it possible that the tax for dividends can be paid by the ltd company along with corporate tax or is dividend tax always paid by the individual?

[@HeelanAssociates]

The tax of dividends paid to private individual shareholders will be income tax, so payable by them. Some owners might choose to take further funds from the company to pay tho. This might help www.heelanassociates.co.uk/how-to-plan-for-your-dividend-tax-bill/

[@Jonnyicey]

@@HeelanAssociates that was useful, thank you.

[@jakekelly8329]

Do corporate shareholders (rather than shareholders who are individuals) have to pay tax on dividends? Cheers

[@HeelanAssociates]

Not usually (UK).

[@letsplaywitheesa1668]

What the difference between corporate shareholders and individual shareholders?

[@user-vt2un1dz2e]

The acceptable dividend rate should be (Top individual tax rate)- (corporate tax). Thats how it is in every other country. In UK this sounds like a theft

[@HeelanAssociates]

The rates have certainly become very ‘odd’ over last few years.

[@evka24]

I am sorry but income of the company is taxed first and then dividends are taxed again ? Sorry I am complete beginner

[@jamestomkinson8474]

That’s what I wasn’t sure about either. It literally makes no sense to run a business in that case. And you’re taxed on virtually all of it compared with being an employee!

[@HeelanAssociates]

That’s right company pays corporation tax and then person receiving the dividends will usually pay some more tax on them as well. Sounds like a bad idea but due to the way the various taxes interact it works out really well at many levels of income. Some of these may help Limited Company Pay Guides kzbin.info/aero/PLkzy-8ym2nIi8vYzSPe2bhFbldNlxQxG-

[@user-vt2un1dz2e]

​@jamestomkinson8474 It makes perfect sense in other countries as dividends are taxed at lower rate, it makes no sense in UK tho. The dividend should be 20%

[@martinhibbert1428]

Very little incentive to start and run a company in the UK. Bearing in mind all the negatives of running your own company like lack of holidays, 100 hour weeks etc etc. Better off being employed as there is not enough reward for the risk and effort it takes to start and run a company. Governments have eroded the benefits available then wonder why we have poor economic growth.

[@HeelanAssociates]

I think there are valid points here, although I don't think they apply specifically to limited companies, I think you could make the argument for self-employed/partnerships as well. Being in business in your own right is often not the 'dream' it may appear!

[@martinhibbert1428]

@@HeelanAssociates Doesn’t seem right to me. Surely government should be encouraging and rewarding business owners so that they have reason to grow and expand their businesses. For me there is not enough reward for the risk taking. Having been employed for many years and recently become a business owner through circumstances I was very surprised once I got my head around the financial environment that business owners have to operate in.