There is a new dividend tax being introduced in 2016. It is going to create a £2,000 tax bill for business owners who are currently utilising their basic rate band for profit extraction with dividends.
Whilst we agree the current dividend tax regime is “archaic”, we think this is generally an unfair tax that is going to hit entrepreneurs and owner managed businesses the hardest. Our opinion is that business owners who employ others and take risk should be given a tax break.
As the corporation tax cut is only happening from 2017, and the full 2% cut from 2020, we see this as a significant tax hike aimed at owner managed business.
A petition has been set up to try and raise this point in parliament. If you agree with us, or the points on the petition, please sign it and share.
If you want a review of your business and how the dividend tax is going to affect you, contact us today.