I wonder if anyone can help me with something that has long confused me.
If I have a limited company, and it makes a profit in year 1 but I decide to leave the profit in the company, then I will only have to pay corporation tax is my understanding. However, if in year 2 I decide that I'd like to remove the profit after corporation tax, I assume I will then also have to pay personal tax on the dividend or salary payment, so in effect the profit has been taxed twice, where if I'd just taken the dividend in year 1 it would only be taxed once.
What am I misunderstanding because this can't be right that profit gets taxed twice. Otherwise nobody would every pay corporation tax, they would always remove all profit from the company each year and only be taxed once.
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