Tax Hikes Push Family Companies to Plan Bumper Dividends
One of the likely results of the upcoming tax hikes – keeping it in the family. A number of family-owned businesses are planning to double up the dividends between now and next March, dodging the increase in the higher rate of income tax to 50pc for those earning more than £150,000. This will limit their tax liability to the current rate for dividends of 32.5pc, rather than the new rate of 42.5pc. Mary …
One of the likely results of the upcoming tax hikes – keeping it in the family.
A number of family-owned businesses are planning to double up the dividends between now and next March, dodging the increase in the higher rate of income tax to 50pc for those earning more than £150,000. This will limit their tax liability to the current rate for dividends of 32.5pc, rather than the new rate of 42.5pc.
Mary Monfries, head of UK private business at PricewaterhouseCoopers, likened it in the Telegraph to a holiday-maker knowing that the US dollar was going to rise in value and so buying currency before the rise. She said:
“I have had a couple [of clients] seriously thinking ‘What do I need funding-wise over the coming few years? If I take it out before April it will cost me less than if I did it afterwards’.”
Nicely put; not sure Alistair and Gordon will see it quite like that though.
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