Employed and Ltd Company - Tax Help Needed

liverpoolcarl

Hi looking for some advice,

I am employed full time earning 30k pa and also sole director of a Ltd company. I haven't yet taken any money from my business yet although i'd like too as soon as i can figure out the right way around it.

The business earns around 10K pa at the moment. From my little understanding I would go on Higher rate tax if I took a 10K dividend.

I am not on the Ltd company pay roll.

Any help much appreciated.

fengirl_2

As a director, you are on the limited company's payroll, even though you may now have drawn a salary yet.
You need to take advice from your accountant on this as whether or not you pay a dividend or salary depends on your other income and circumstancces and on the company's CT liability.

liverpoolcarl

I have an appointment on Friday. From the brief telephone conversation I had with her when making my appointment is that I should take 7K as a dividend and leave 3k in the business and avoid going on higher rate tax. I was a sole trader before and only went ltd in July 09 so this is all new.

I would like to understand the tax involved. Around dividends and then my tax return.

I was advised to go ltd last year as I would have hit higher rate tax which would have affected my full time income as well. I am told with LTD there are ways around this.