- Original Poster
- #1
Hey all, hope everyone had a lovely festive break!
Last year I took a total dividend of £11,000 this was spread out over the financial year and when it came to the tax return, a total of £111 was added to that amount, and then a total of £1111.10 was deducted due to 10% tax credits on dividends from UK Companies (not repayable). That was based on pay of £20,500 (roughly) for that year.
I still to this day, do not understand that, it's fine of course, but anyhow...
This financial year I purchased a house, and so, have taken a rather large amount of dividends in these past few months, to be exact, £20,500, which, to many of you, is no doubt still small, but to me, I had to sit down with a large whiskey and try to stop myself going into a panic attack! Such is the house buying process, fixing previous owners mistakes etc!
Anyhow, I digress... My question really is, based on the above, what is the likely amount of CT I will be paying come April 2016? So far I have not reached the £20,500 of pay of the previous year (albeit the dividends are higher so essentially taking me at the moment to around £35,000 if they count wages/dividends together?
If we assume that my 'wage' pay will not be any higher than, say a total of £30,000 come April 2016, and the dividends do not rise any higher than say, £22,000.
Is it a fixed amount of tax on dividends, of 20%? So If I had paid £22,000 in dividends in the 15-16 tax year, the tax bill for that would be £4400? Or does it depend on my total earnings? Or is it 10% ?
Thanks in advance... I know taking dividends is no 'problem' provided it is done correctly, but I do worry about a tax bill spiralling out of control of course come the time of CT!
Last year I took a total dividend of £11,000 this was spread out over the financial year and when it came to the tax return, a total of £111 was added to that amount, and then a total of £1111.10 was deducted due to 10% tax credits on dividends from UK Companies (not repayable). That was based on pay of £20,500 (roughly) for that year.
I still to this day, do not understand that, it's fine of course, but anyhow...
This financial year I purchased a house, and so, have taken a rather large amount of dividends in these past few months, to be exact, £20,500, which, to many of you, is no doubt still small, but to me, I had to sit down with a large whiskey and try to stop myself going into a panic attack! Such is the house buying process, fixing previous owners mistakes etc!
Anyhow, I digress... My question really is, based on the above, what is the likely amount of CT I will be paying come April 2016? So far I have not reached the £20,500 of pay of the previous year (albeit the dividends are higher so essentially taking me at the moment to around £35,000 if they count wages/dividends together?
If we assume that my 'wage' pay will not be any higher than, say a total of £30,000 come April 2016, and the dividends do not rise any higher than say, £22,000.
Is it a fixed amount of tax on dividends, of 20%? So If I had paid £22,000 in dividends in the 15-16 tax year, the tax bill for that would be £4400? Or does it depend on my total earnings? Or is it 10% ?
Thanks in advance... I know taking dividends is no 'problem' provided it is done correctly, but I do worry about a tax bill spiralling out of control of course come the time of CT!
