'nther ISA question
Discussion
Should be a simple one, but Google didn't come up with anything that I could make sense of...
I pay myself via PAYE and (very small) dividends, and am growing a nice surplus in the business. What is the best way (most tax efficient) to take some of that surplus out and stick it into an ISA? I dont want to make pension contributions, although I do have a small pension fund, as I don't trust the gubberment not to screw around with funds and how/when you can access them (I know thats possibly changing, but...)
Is it better to up the dividend by the amount I want and take the 20% corp tax hit, or is there a better way?
I pay myself via PAYE and (very small) dividends, and am growing a nice surplus in the business. What is the best way (most tax efficient) to take some of that surplus out and stick it into an ISA? I dont want to make pension contributions, although I do have a small pension fund, as I don't trust the gubberment not to screw around with funds and how/when you can access them (I know thats possibly changing, but...)
Is it better to up the dividend by the amount I want and take the 20% corp tax hit, or is there a better way?
Assuming you are a standard rate tax payer its best to take PAYE at £663 a month and then everything else in dividends this will save you the 13.5% national insurance contributions.
Essentially the company pays your income tax up to something like £30k (and a bit) of dividends as there is a 10% tax credit attached to dividends.
A decent accountant will do the dividend paperwork for almost pennies if you are worried about that aspect.
Essentially the company pays your income tax up to something like £30k (and a bit) of dividends as there is a 10% tax credit attached to dividends.
A decent accountant will do the dividend paperwork for almost pennies if you are worried about that aspect.
mondeoman said:
Should be a simple one, but Google didn't come up with anything that I could make sense of...
I pay myself via PAYE and (very small) dividends, and am growing a nice surplus in the business. What is the best way (most tax efficient) to take some of that surplus out and stick it into an ISA? I dont want to make pension contributions, although I do have a small pension fund, as I don't trust the gubberment not to screw around with funds and how/when you can access them (I know thats possibly changing, but...)
Is it better to up the dividend by the amount I want and take the 20% corp tax hit, or is there a better way?
Change your perception and open a company pension and put it in there (subject to annual allowance). 20% tax relief building up a pot from which you can withdraw a quarter completely tax free with the rest being dripped down at a time when the personal allowance is, say, £15k.I pay myself via PAYE and (very small) dividends, and am growing a nice surplus in the business. What is the best way (most tax efficient) to take some of that surplus out and stick it into an ISA? I dont want to make pension contributions, although I do have a small pension fund, as I don't trust the gubberment not to screw around with funds and how/when you can access them (I know thats possibly changing, but...)
Is it better to up the dividend by the amount I want and take the 20% corp tax hit, or is there a better way?
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