Results for: Salary 1 = £50,000; Salary 2 = £50,000; Profit before taxes = £1; Dividend Split = 100/0%
| With Split | No Split | More Profit | ||
|---|---|---|---|---|
| Combined Net Income: | £39,521 | £79,042 | £0 | |
| Company: | ||||
| Profits Before Tax | £1 | £1 | £1 | |
| Corporation tax | £0.19 | £0.19 | £0 | |
| Distributable Profits | £0.81 | £0.81 | £0 | |
| 1st Employee: | ||||
| Salary | £50,000 | £50,000 | £50,000 | |
| Paye | £7,486 | £7,486 | £7,486 | |
| Employees N.I. | £2,993 | £2,993 | £2,993 | |
| Dividend taxes | £0 | £0 | £0 | |
| 2nd Employee: | ||||
| Salary | £50,000 | £50,000 | £50,000 | |
| Paye | £7,486 | £7,486 | £7,486 | |
| Employees N.I. | £2,993 | £2,993 | £2,993 | |
| Dividend taxes | £0 | N/A | N/A | |
| Combined Taxes: | ||||
| All taxes* | £23,961 | £23,961 | £0 |
- If Income Shifting comes in, your net income will decrease by £0 per year.
- This means two things: 1) Your tax bill will rise by 0%; and 2) Your income will decrease by 100%.
- To overcome the extra taxes and earn the same net income you will need to increase your profits by 0%.
- The changes are because all dividends will have to be taken by the first shareholder - which means more of the dividend income will be subject to higher rate tax.
* Figures includes Employers NI of £3,002, which is paid from company revenues.
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