Further complications for Company Owners April 2010
The new top rate of 50% income tax comes into effect from 6 April 2010 on taxable income of £150,000 and above.
Paying dividends
If your company has surplus cash it could make sense to pay an interim dividend before the new income rate is introduced. Companies can only pay dividends out of accumulated profits though.
Pensions
Don’t forget tax relief on pensions has been restricted with relief actually ceasing for those earning £180,000 and above. If you’re earning less than £150,000 then consider making the most of the opportunities to benefit from full tax relief while it is still available.
Tax Planning
If you are a company owner then it may be worthwhile transferring some of your shares into the names of either your spouse, partner or adult member of your family. You can then take advantage of lower tax bands and personal allowances when distributing company profits as dividends.
Contact mark.busby@dbsellek.co.uk for professional guidance.
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