Calculate the income tax payable on your dividends
Find out how much income tax you must pay, based on your current salary and annual dividend payments, with this calculator.
Most contractors using a limited company operate a ‘low salary high dividends’ strategy. They pay a salary within their personal allowance and just below the threshold where NICs need paying, with the remainder paid as dividends.
This is typically the most tax-efficient method as it significantly lowers tax and NIC liabilities. From April 2016, the Government has raised tax on dividends.
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