Changes to taking money out of your company 2018 – 19
This is the annual update for the amounts to withdraw from your company.
The changes to dividend tax means that most business owners be rewarded in dividends will pay more personal tax from 6th April 2018.
For the 2017/18 tax year we advised a director / shareholder to take the following ‘optimum’ monthly amounts out of their personal company.
• Salary £958.33 a month or £11,500 a year
• Dividend of £2,791.66 a month or £33,500 a year
These amounts gave a small employee’s national insurance of £42,462 assuming you have no other sources of income.
These amounts are effectively doubled for ‘husband and wife’ companies.
Revised amounts from 6th April 2018
Our suggested amounts of salary and dividends to take are:
• Salary £987.50 month or £11,850 a year
• Dividend of £2,875 a month or £34,500 a year.
These amounts gave a small employee’s national insurance to pay on the salary of £411.12 and a personal income tax charge of £2,437.50.
This will give net income after tax and national insurance of £43,501 assuming you have no other sources of income.
These amounts are the ‘default’ advice for the vast majority of our clients. these amounts are effectively doubled for ‘husband and wife’ companies.
You can of course take money from your company but extra dividends, salary or benefits will give you a higher tax bill, you may also pay extra tax if your household is in receipt of child benefit.
Please contact us if you have any questions.
Office: 0118 923 5800