Dividend tax rates to increase by 1.25% from April 2022
In a bid to level the playing field with business owners who take lower salaries and supplement their income with dividends which do not attract NIC, the government also announced an increase in dividend tax rates by 1.25% from April 2022. This will see the existing dividend tax rate on basic rate taxpayers increase from 7.5% to 8.75%, while the dividend tax rate applying to dividends above the higher rate tax threshold will increase from 32.5% to 33.75%, with those dividends over the additional rate tax threshold increasing from 38.1% to 39.35%. This represents an additional tax burden on business owners, on top of the additional employers NIC cost for their businesses.
For further advice on this matter, please contact me.
Related Posts
KRW Accountants to rebrand to Affinia
n a bid to encourage more people to save into stocks and shares, the current £20k per annum allowance for investing in ISA will be restricted to £12k per annum for investment into a cash ISA.
Q&A: How much can I claim per mile for charging my electric company car?
n a bid to encourage more people to save into stocks and shares, the current £20k per annum allowance for investing in ISA will be restricted to £12k per annum for investment into a cash ISA.
Tax tip: Electric cars remain a tax-efficient perk for company owners
n a bid to encourage more people to save into stocks and shares, the current £20k per annum allowance for investing in ISA will be restricted to £12k per annum for investment into a cash ISA.
Andy Burnham shows support for pubs with 20% business rates reduction
n a bid to encourage more people to save into stocks and shares, the current £20k per annum allowance for investing in ISA will be restricted to £12k per annum for investment into a cash ISA.
Cash ISA allowance will be reduced from £20k to £12k from April 2027
n a bid to encourage more people to save into stocks and shares, the current £20k per annum allowance for investing in ISA will be restricted to £12k per annum for investment into a cash ISA.
Mansion tax for homes worth over £2M from April 2028
As expected, a new High Value Council Tax Surcharge was announced which will kick in from April 2028 and apply to homes worth over £2m.
100% CGT relief for shares sold to employee ownership trust halved
Under current rules, if you sell more than 51% ownership of your business to an Employee Ownership Trust then there is a 100% relief, and no Capital Gains Tax has to be paid on the sale.
Permanent rates reduction for hospitality, retail and leisure
Two new, lower, multipliers will be introduced for these sectors from April 2026, in a bid to permanently reduce business rates for affected businesses.
NIC to apply to salary sacrifice pension arrangements from April 2029
As widely anticipated in the lead up the Budget, it was today announced that NIC will apply to pension contributions from April 2029, but only insofar as there will no longer be an NIC saving for employees and employers that sacrifice more than £2k pa of their salary to pay into a pension.
Mileage based electric/hybrid vehicle excise duty from April 2028
It was today announced that the government are introducing a new Electric Vehicle Excise Duty (eVED) from April 2028 which will impose a charge of 3p per mile.