The dividend tax rate is increasing with effect from 6 April 2022.
The tax rates will be:
- First £2,000 of dividends 0%
- Dividends within the basic rate band (up to £37,700 of income after personal allowances) 8.75%
- Dividends within the higher rate band (£37,701 to £150,000 of income after personal allowances) 33.75%
- Dividends in the additional rate (income in excess of £150,000) 39.35%
Subject to sufficient company reserves, maximising dividends pre-tax year end may be worthwhile.
If you would like to discuss dividend or remuneration planning, please do contact us .