LTD Company Tax Calculator?

TaxQuestions_2

Does anyone know where I can find an online calculator that can give me an estimate of how much tax I'm supposed to pay?

I have an accountant but am in the process of filing my reports and would like a rough heads up.

I've googled but only see them for contractors.

I'd like one that will work out how much I will have to pay taking into account dividends etc.

EG my company made £40,000 in profit in the year. There are two shareholders who will be spliting the dividend, so how much tax wlll be due in total?

Any ideas? Much appreciated! Thanks.

Dazed_and_confused

Your post is titled LTD Company Tax Calculator but you then refer to the dividend the company is paying and the shareholders.

What exactly are you trying to find out?
how much tax the company will have to pay
how much tax the individuals will have to pay on the dividends (my guess is £15240)
both of the above
something else

TaxQuestions_2

Sorry, I'm not sure of the terminology!

I was trying to find out how much the total amount tax to be paid by everyone would be - the company and the shareholders.

Thanks.

Dazed_and_confused

No idea about the company sorry but you should be safe to assume £15240 will be payable by the individuals on the dividends

booksurr

the company will pay corporation tax on its taxable profits. That figure may not be the same as the profit shown in the accounts as some costs are ineligible for tax purposes (eg depreciation, client entertaining, etc ) and must be added back to give a higher taxable profit than the accounting profit. Obviously a company does not get a tax free "personal" allowance, so pays 20% on the whole taxable profit.

without having the details of all your expenses in front of us only your accountant can give you the correct figure for the CT which is currently 20% (reduces to 19% from April 2017).

for the sake of an example only, if the taxable profit is 40k then CT will be 8k leaving 32k of post tax profits available for distribution. If there are 2 equal shareholders and they withdraw the total profits leaving nothing in the company then each would get a dividend of 16,000 and each would then be subject to personal income tax on their respective dividend

Again without knowing the total income of each person all that can be said is for a dividend of 16k each some of it may be at the basic rate (7.5%, net of the £5k nil rate band) and/or some of it may be at the higher rate (32.5%), it all depends on each person's total and therefore what tax bracket they fall in as dividend income is deemed to be the "top slice"of a person's income so always falls into their marginal/highest tax bracket. To be taxed at the additional rate of 38.1% (your £15,240 figure) would imply that each person has a total income in excess of 150k before the dividend is added to their income???

https://www.gov.uk/government/publications/dividend-allowance-factsheet/dividend-allowance-factsheet

TaxQuestions_2

Thanks for that.

This is the only income of the shareholders.

each would get a dividend of 16,000 and each would then be subject to personal income tax on their respective dividend

So of that 16k, 5k is not taxed leaving tax to be paid on the 11k at what rate?

Thanks!

Dazed_and_confused

Are they not entitled to the personal allowance?

Are you really saying that for an entire tax year neither shareholder had ANY other income, no savings interest, bank reward payment, wages (from previous job?), DWP benefit, company benefit in kind etc etc

Cook_County

What software is the company using for bookkeeping? Does it estimate VAT and corporation tax payable for the company?

TaxQuestions_2

I assumed that we would have our personal allowance but the previous replies seemed to suggest otherwise?

If we do get the allowance of £11k we only pay tax on the remaining £5k of the dividend? If so at what rate?

Yes this is our only income apart from child benefit which I thought was excempt? We're just a couple of lowly freelancers working part-time and looking after our kids until they start school.

I'm using Freshbooks accounting software and is be surprised if it could handle this type of calculation. Can FreeAgent do this?

Thanks again for all your help.

Dazed_and_confused

That would presumably be because you previously supplied no useful information about your income.

Why do you now think you won't be entitled to the dividend allowance/nil rate band?

Darksparkle

These examples show you still get the personal allowance as well as the dividend allowance - https://www.gov.uk/government/publications/dividend-allowance-factsheet/dividend-allowance-factsheet#examples

If I'm reading it right it would mean you wouldn't pay any tax.