The Book-keepers Forum (BKF)
The Book-keepers Forum (UK) -> VAT, Payroll & Tax -> Corp Tax and dividends
Post Info TOPIC: Corp Tax and dividends
Jo Gordon


Veteran Member

Status: Offline
Posts: 76
Date:
Corp Tax and dividends
Permalink Closed

Can anyone tell me very briefly, how CT and dividends work from a company's point of view?  I have no intentions of passing this on to clients, I'd just like to get it right in my own head.

I know that if a company pays a dividend, it deducts 10% and pays out the 90%.  What then happens to that 10%?  Is it paid to HMRC?

What then happens about CT? Presumably if CT is then calculated and paid, is there a double whammy, or is there some kind of off-set?

Thanks!

 



__________________
Andy_L75


Veteran Member

Status: Offline
Posts: 29
Date:
Permalink Closed

Corporation tax is paid before dividends.

Dividends are then paid and put on the personal tax return.

For example if you receive a 10k dividend, this is class as 90% so the gross dividend on the tax return is £11111.11

You then get a 10% notional tax credit of on the £11111.11 which is the £1111.11.

Therefore its not paid over to hmrc. You only pay tax on the dividend if it pushes you into the higher tax bracket

__________________
Jo Gordon


Veteran Member

Status: Offline
Posts: 76
Date:
Permalink Closed

Thanks Andy. Think I've got it now.



__________________
Page 1 of 1  sorted by
 
Quick Reply

Please log in to post quick replies.
The Book-keepers Forum (UK) -> VAT, Payroll & Tax -> Corp Tax and dividends
Tweet this page Post to Digg Post to Del.icio.us
Members Login
Username 
 
Password 
    Remember Me  
©2007-2024 The Book-keepers Forum (BKF). All Rights Reserved. The Book-keepers Forum (BKF) is a trading division of Bookcert Ltd. Registered in England Company Number 05782923. 2 Laurel House, 1 Station Rd, Worle, Weston-super-Mare, North Somerset, BS22 6AR, United Kingdom. The Book-keepers Forum and BKF are trademarks of Bookcert Ltd. This forum is a discussion forum only. There will usually be more than one opinion to any question and any posting should not be viewed as a definitive solution. No responsibility for loss occasioned to any person acting or refraining from action as a result of any posting on this site is accepted by the contributors or The Book-keepers Forum. In all cases, appropriate professional advice should be sought before making a decision. We reserve the right to remove any postings which are offensive, libellous, self-promoting or engaged in covert marketing. We will not notify users of removals. The views expressed in the forum posts are those of the individual and do not necessary reflect or agree with those of The Book-keepers Forum. Any offensive or unsuitable posts will be removed by the moderators. Any reader of this forum can request for a post to be looked into by sending an email to: bookcertltd@gmail.com.

Privacy & Cookie Policy  About