This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our Cookie Policy.
Analytics

Tools which collect anonymous data to enable us to see how visitors use our site and how it performs. We use this to improve our products, services and user experience.

Essential

Tools that enable essential services and functionality, including identity verification, service continuity and site security.

Where Taxpayers and Advisers Meet

Dividends & NI payments

David13
Posts: 1
Joined: Wed Aug 06, 2008 3:03 pm

Postby David13 » Sun Apr 13, 2003 2:59 am

Could you please explain what NI payments are due on Directors who are paid dividends as part of their remuneration i.e. they are partly paid a salary and part as a dividend. Also are dividends paid to directors liable for Income tax at the same rates as salary.
Is this the most tax efficient method of making payments to Directors?

Many thanks

topcom
Posts: 42
Joined: Wed Aug 06, 2008 2:18 pm

Postby topcom » Sun Apr 13, 2003 6:37 am

Directors are not affected by the minimum wage, and can pay themselves a salary to cover their personal allowances £4,615 currently. Dividends are an appropriation of profit and are paid out of profits after corporation tax. If you not a higher rate tax payer then you receive a tax credit which is 10% and this equates to the rate of tax due on dividends so no further tax is due.
There is currently no nic applicable to dividends.
Chartertax
07768 717195

colin hall
Posts: 1
Joined: Wed Aug 06, 2008 3:06 pm

Postby colin hall » Wed Oct 08, 2003 2:17 am

Are dividend payments added to paye salary to calculate total income? If so and above higher rate what is the tax and NI implications


Return to “PAYE and Payroll Taxes, National Insurance, NICs”