I am interested in "which order" the three taxes are assessed and hope somebody can help.
This year (17/18) I expect to earn £40k from regular income, plus £20k in Capital Gain on a second property. I can also pay myself a £5k Dividend from my business. I understand that my £5k Dividend should be tax-free.
If I am able to consider my Capital Gain BEFORE my Dividend, what would leave me with £5k still of my Basic Rate band so I pay 18% on the first £5k of my Capital Gain and 28% on the other £15k. However, if I have to consider the Dividend first, although tax-free it will still eat up my Basic Rate band so I have to pay 28% on all £20k of my Capital Gain.
Which is correct, please?
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