Dividends from the stock market encouraged me to begin investing. What matters, in my opinion, is that if you invest and make additional money in addition to dividends, you will be able to live off of dividends without selling. It implies that you can provide that benefit for your children, giving them a head start in life. I've invested more than $600,000 in dividend stocks throughout the years; I'm currently buying more today and will continue to do so until the price falls even further.
Hearing from an experienced investor who has survived the crisis and prospered is always comforting. It could be worrisome when your portfolio goes from green to red, but if you have invested in strong firms, you should just keep growing them and stick to your goal.
I wholeheartedly concur, which is why I appreciate giving an investment coach the power of decision-making. Given their specialized expertise and education, as well as the fact that each and every one of their skills is centered on harnessing risk for its asymmetrical potential and controlling it as a buffer against certain unfavorable developments, it is practically impossible for them to underperform. I have made over $400K working with an investment coach for more than two years.
There are many financial coaches who excel in their profession, but for the time being, I employ Annette Marie Holt because I adore her methods. You can make research and find out more.
The thing to me is, if you invest and have other income outside of dividends then you will be able to live off dividends without selling. Which means you can pass that on to your kids which will give them a leg up in life. $52k dividends received in 2022.
I agree! That's why it is advisable that you have to invest while you still have a regular job or earning a regular income, and do it constantly. You still need to have something that will keep you going even if you're investing. Good financial planning and money allocation is the key.
The best course of action if you lack market knowledge is to ask a consultant or investing coach for guidance or assistance. Speaking with a consultant helped me stay afloat in the market and grow my portfolio to about 65% since January, even though I know it sounds obvious or generic. I believe that is the most effective way to enter the business at the moment.
Carol Vivian Constable is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment..
Just a reminder for people watching this, it is different for Scotland who have a separate set of income tax rates and bandings. The Welsh Assembly has the power to vary income tax rates but currently they have chosen not to do so. They do not however as things stand have the power to change or create tax bandings. That being said the same principle would still ring true, a salary at PA and dividends above that. So likely same advice for Scotland just with different overall effective tax rate.
Great video, could you please so an update after the Oct budget because it is very likely that the dividend rates will change. Many thanks for the great content that you keep producing
Im a director of my own co and biggest issue for me is the 40% threshold hasnt changed for years. 50k does not go far now due to.inflation. Im not willing to pay 40% tax so i cap my income at 50k but as crazy as it sounds its hard to have a good lifestyle with that. I can only stick profit in pension now.
Good video. Many accountants increase their fees when a Limited Company begins paying National Insurance. Consequently, numerous advisors suggest a salary of £9.1K and then utilize the remaining personal allowance in the dividends. Limited Company owners should allocate a significant percentage of profits to their pensions. For a future video, please consider addressing those compelled to use an umbrella company but may still possess a dormant Limited Company, possibly registered for VAT. Are there any tips for those using an Umbrella Company and how can we harness the mounting losses in a dormant Ltd Co? (minor dummy salary plus accountants fees)
My portfolio doesn’t just cater to dividend stocks. I hold $VFIAX (S&P 500 index fund) in my Roth IRA and $VTI (Total Stock Market ETF) in my taxable brokerage account. Two of my largest holdings. The individual dividend stock positions all complement the index holdings.
Thats when you hire someone to manage your money. You need a (CFP) straight up! personally, I would invest in ETF's and also love investing in individual stocks.
I took charge of my portfolio but faced losses in 2022. Realizing the need for a change, I sought advice from a fiduciary advisor. Through restructuring and diversification with dividend stocks, ETFs, Mutual funds, and REITs, my $1.2M portfolio surged, yielding an annualized gain of 28%.
‘’Aileen Gertrude Tippy’’ is her name. She is regarded as a genius in her area and works for Empower Financial Services. She’s quite known in her field, look-her up.
I like this channel talks honestly and openly about the unspoken valued things people need and ultimately get shafted on. Find other channels grey and unclear.
Amazing content! I have been following your videos for sometime now, consistently kicking down Wall Street doors for two years now, I have over $320k in stocks. Currently, my portfolio is down by 15%.. Wondering if they're any short term opportunities I can invest in
I agree that there are strategies that could be put in place for solid gains regardless of economy or market condition, but such executions are usually carried out by investment experts or advisors with experience. Reason I decided to work closely with an brokerage-adviser ever since the market got really tensed and the pressure became so much(I should be retiring in 17months) so I've had an brokerage-adviser guide me through the chaos, its been 9months and counting and I've made approx. 650K net from all of my holdings.
Gabriel Alberto William is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
Thanks for this very informative video Kiran. Any suggestions on how to optimise salary for full-time working salaried individuals? If you are earning anywhere over £100k - what's the best way to ensure you pay less tax and optimise your take-home pay?
maximise your pension contributions as they are all tax free. invest in some SEIS setup by friends. basically get pretty much all your income tax paid back that way over the last couple of years plus some of your capital gains. eg if you were earning 100k annually you would pay 27k/year in tax so over 2 years 52k paid in tax. put 104k into a friends business. in 6months the government give you back 52k and 21k in capital gains relief so you have claimed. 73k out of the 104k is now back in your pocket. your at risk amount is now 31k if your mate messes up completely and losses your 100k investment that only cost you 31k you can also claim loss relief against capital gains tax. so basically no lose investment. some caveats with this like you cant give it to your mother or use on rental properties or solar panels.
@@Call_Centre_Conversationsthank you for sharing this. Could you please provide more details for the same amount 100k/year online business, no major expanses. Would love to understand how much I could have in my pocket since I believe I cannot access pension contributions until later in life.
@@nestor.koylyakwould love to. How long has the online business been running? Is it vat registered? Is the business generating the income through the sale of goods or through the sale of services? With your pension you can access the funds earlier through a few different arrangements but we need to go through more information to be better for you. For instance you may want to investigate ssas.
@@nestor.koylyak can access your pension earlier through a few strategies. One such strategy is SSAP. 100k a year online business would need to know a few more things. For instance is it vat registered? Is it flat or rate vat or normal rate vat. If flat rate what is the flat rate you are on. Do any family or friends help you out in it for instance your partner or parents. If your parents are helping you out in it and are pensioners, then they would pay no employee national insurance. So paying a pensioner parent for the help they do works out better. For instance your mum may have stayed in the whole day to sign for a delivery for your business. Thats going to be at least £100. If your business pays her £100 then she pays 20% income tax on that then she has £80 in her pocket. If she refuses to accept the payment then you withdraw the £100 through paye from your business then it will be at least 20% income tax and 8% employees national insurance you need to take out. So would be £72 in your pocket. If the two of you have a common goal such as going out for dinner together, then I'm sure you can agree that you taking £100 from the business to put £80 in her pocket is better than you taking out £100 from the business to put £72 in your pocket.
If as a sole trader you earn over the 50k basic tax rate, you’d start paying the 40% on anything over that. That’s when you should probably transition to a limited company
Corporation tax at 19% is only on profits less than £50k , plus wait till we have the October budget and I won’t be surprised if that 19% rate is abolished.
inclined to agree. come October if the budget puts the corp tax back to 20% it will be do you want to: A)pay corporation tax of 20% and dividend tax of 8.75% or B)pay 20% income tax and 8% national insurance basically give yourself ball ache to pay more tax if you paid by dividend.
Really helpful video thank you. I think the thing that irks me most is you pay corporation tax and then when you pay yourself you get taxed AGAIN on dividends - so effectively taxed twice. It's appalling!
hands down outside ir35 is better. inside ir35 you pay employers national insurance of 13.8%. when you are outside ir35 you will get the small employers national insurance allowance of £5,000 so for the first £5,000 of employers national insurance you pay £0. other problems with being inside IR35 is you can't claim travel or accommodation or subsistence. If you are inside ir35 and running through an umbrella you got other downsides too such as paying the umbrella their fees (at least £20/week which will end up being £1000/year) as well as taking the risk the umbrella company is keeping your money.
❤ thanks for sharing your knowledge. A question if you want to maximise your pension benefits, £60k allowance, how can the director do this if salary is set to this level?
Make an ‘employer contribution’ up to that level direct from the company to the pension fund itself. Tax deductible for the company and not taxable or liable to NIC on the director so fully tax efficient.
@@kevbarker73I just learnt this after researching. My accountant never bothered informing me about it, meaning that instead of paying massive corporation tax or income tax, I could have topped up my pension. Needless to say, I am now doing it and transferring as much as possible onto the pension funds
Great videos! However, in this one, there's no mention of purchasing plant and machinery (Nissan Vans included 😊). Could you also clarify if there are any benefits or reductions to Corporation Tax (CT) for a company car? Additionally, what are the differences between having an electric vehicle (EV) versus an internal combustion engine (ICE) car in terms of tax advantages?
What happens to money left in a limited company if you just leave it in the business account after earning it? Does it get taxed at the end of the year or does it only get taxed when it is withdrawn from the business in the form of salary, dividends etc?
@@jonathanhowson6420 sorry am not clued up on rebates to the company Corp tax. I know you reclaim income tax relief in this manner - but the relief I believe, am not an accountant or qualified to give advice you understand, is against the ‘current’ year’s tax. So if you earned £10M last year and £10 this year - you wouldn’t save any tax at all by deferring the pension payment. Whether that works the same for companies I would be guessing. I am aware there are different pension options - salary sacrifice vs not for example - this may also affect your situation. It would be worth getting an accountant to have a look at your situation specifically / or at least getting a quote for one and seeing how the cost stacks up against the potential saving that could be made.
This is great for earnings of 50-60k but whats the best way to then pay yourself more above this other than getting a partner onboard and repeatibg the process?
you've used up £11,000 of your £12,500 personal allowance so can only withdraw £1,500 more from the limited company before hitting the personal allowance. however if you are a pensioner you do not pay employees national insurance and you probably be under the £5,000 employers national insurance relief so withdraw as much as you want through PAY rather than dividend. You will only pay 20% on the PAY withdrawals v when using dividends 8.75% personal dividend tax+ 19% corporation tax Worked example is your company has £10,000 profit. you withdraw that all as personal pay and pay 20% income tax as £2,000 putting £8,000 in your bank account. If you were to withdraw as dividend then you would pay 19% corporation tax of £10,000 making it £1,900 payable in corp tax leaving you with £8,100 to withdraw as dividends. The first £500 will be 0% dividend tax so £7,600 will be taxed at 8.75% or £665 dividend tax leaving you with £6,935 in your bank account
Hi could you tell me e if I was to take £12500 salary and £50000 dividends would I save alot in tax compared to doing £62500 as a sole trader When taking into account corporation tax and my tax an NI?
If your company makes a lot of profit, would it be better to have a directors salary of 85k as you can reduce your corp tax bill, which would be taxed at 25%.
If you have a job with a salary of 52k, and also have a Ltd company does this mean by paying a dividend your paying around 20% corporation tax then 33.75% on the dividend amount. Totaling around 55%. So in this case would paying yourself as a director assuming at 40% be the better option?
This video has either gone completely over your head or you just did not listen. It’s specifically for Directors who earn PAYE AND DIVIDENDS from the SAME COMPANY
@@Liberty_Freedom_Brotherhood Looks like my question has gone completely over your head or you did not read, my situation is different to that of the video hence my question.
If you have a job at 52k salary, you’d be paying mainly 20% on that salary, using up all of your Basic Rate tax code. Then say you want to pay yourself a £10k dividend out of your Ltd company, this would be taxed at the 33.75% as your total income is £62k (52k salary + £10k dividend) - you do however get a £500 free tax dividend allowance. As your Ltd company has paid you a dividend and not a ‘salary’ which isn’t tax deductible on the company side, your business would still pay corp tax on the £10k you took out. You can obviously only pay yourself a dividend if you have profit in the Ltd company and the corp tax is on a sliding scale with 19% only being applied to profits on less than £50k Hope that helps
These are very valuable rules for anybody who wants to get rich. Unfortunately, most people who will watch this video will not really be able to apply the principles. We may not want to admit, but as Warren Buffett once said, investing is like any other profession-- it requires a certain level of expertise. No surprise that some people are losing a lot of money in the bear market, while others are making hundreds of thousands in profit. I just don't know how they do it. I have about $89k now to put in the market.
Great video! I really have a question. For someone with less than $3,000 to invest, how would you recommend we enter the crypto market? I am looking at studying some traders and copying their strategy rather than investing myself and losing money emotionally. What's your take on this approach?
My advice: for newbies to grow financially this year, invest. Saving is good, but investing elevates your finances. Why newbie make huge losses on trade is because investing without proper guidance can lead to mistakes and losses. that will stop you from trading, this has been one of the biggest problem to new traders, I've learned this from my own experience
Tracy Britt Cool Consulting was my hope during the 'bear summer' last year. I made so many mistakes but also learned so much from it, and of course from Tracy.
Hi could you tell me e if I was to take £12500 salary and £50000 dividends would I save alot in tax compared to doing £62500 as a sole trader When taking into account corporation tax and my tax an NI?
![Lp. Сердце Вселенной #60 РОЖДЕНИЕ ЛОЛОЛОШКИ [Финал] • Майнкрафт](http://i.ytimg.com/vi/YoR0pAV9FVQ/mqdefault.jpg)
Dividends from the stock market encouraged me to begin investing. What matters, in my opinion, is that if you invest and make additional money in addition to dividends, you will be able to live off of dividends without selling. It implies that you can provide that benefit for your children, giving them a head start in life. I've invested more than $600,000 in dividend stocks throughout the years; I'm currently buying more today and will continue to do so until the price falls even further.
Hearing from an experienced investor who has survived the crisis and prospered is always comforting. It could be worrisome when your portfolio goes from green to red, but if you have invested in strong firms, you should just keep growing them and stick to your goal.
I wholeheartedly concur, which is why I appreciate giving an investment coach the power of decision-making. Given their specialized expertise and education, as well as the fact that each and every one of their skills is centered on harnessing risk for its asymmetrical potential and controlling it as a buffer against certain unfavorable developments, it is practically impossible for them to underperform. I have made over $400K working with an investment coach for more than two years.
@@hasede-lg9hj Wow, that sounds great, but how can I contact your investment coach?
Wow, that sounds great, but how can I contact your investment coach?
There are many financial coaches who excel in their profession, but for the time being, I employ Annette Marie Holt because I adore her methods. You can make research and find out more.
The thing to me is, if you invest and have other income outside of dividends then you will be able to live off dividends without selling. Which means you can pass that on to your kids which will give them a leg up in life. $52k dividends received in 2022.
I agree! That's why it is advisable that you have to invest while you still have a regular job or earning a regular income, and do it constantly. You still need to have something that will keep you going even if you're investing. Good financial planning and money allocation is the key.
The best course of action if you lack market knowledge is to ask a consultant or investing coach for guidance or assistance. Speaking with a consultant helped me stay afloat in the market and grow my portfolio to about 65% since January, even though I know it sounds obvious or generic. I believe that is the most effective way to enter the business at the moment.
please who is the consultant that assist you with your investment and if you don't mind, how do I get in touch with them?
Carol Vivian Constable is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment..
She appears to be well-educated and well-read. I ran an online search on her name and came across her website; thank you for sharing.
Love this video!!!!
you are dropping diamonds 💎 in this video. I'm taking notes!
keep up the good work.
Thank you Kiran
Just a reminder for people watching this, it is different for Scotland who have a separate set of income tax rates and bandings. The Welsh Assembly has the power to vary income tax rates but currently they have chosen not to do so. They do not however as things stand have the power to change or create tax bandings. That being said the same principle would still ring true, a salary at PA and dividends above that. So likely same advice for Scotland just with different overall effective tax rate.
Great video, could you please so an update after the Oct budget because it is very likely that the dividend rates will change. Many thanks for the great content that you keep producing
It would be very useful to understand how directors pension contributions work as well, and how the tax works with directors pensions.
Im a director of my own co and biggest issue for me is the 40% threshold hasnt changed for years. 50k does not go far now due to.inflation. Im not willing to pay 40% tax so i cap my income at 50k but as crazy as it sounds its hard to have a good lifestyle with that. I can only stick profit in pension now.
Labour will come for that shortly and all!
Live in a different country and operate your business here. Keeping your expenses low
Good video. Many accountants increase their fees when a Limited Company begins paying National Insurance. Consequently, numerous advisors suggest a salary of £9.1K and then utilize the remaining personal allowance in the dividends. Limited Company owners should allocate a significant percentage of profits to their pensions. For a future video, please consider addressing those compelled to use an umbrella company but may still possess a dormant Limited Company, possibly registered for VAT. Are there any tips for those using an Umbrella Company and how can we harness the mounting losses in a dormant Ltd Co? (minor dummy salary plus accountants fees)
This was just the info I was looking for. Thankyou
Loved this, keep these insightful videos coming!
My portfolio doesn’t just cater to dividend stocks. I hold $VFIAX (S&P 500 index fund) in my Roth IRA and $VTI (Total Stock Market ETF) in my taxable brokerage account. Two of my largest holdings. The individual dividend stock positions all complement the index holdings.
Thats when you hire someone to manage your money. You need a (CFP) straight up! personally, I would invest in ETF's and also love investing in individual stocks.
I took charge of my portfolio but faced losses in 2022. Realizing the need for a change, I sought advice from a fiduciary advisor. Through restructuring and diversification with dividend stocks, ETFs, Mutual funds, and REITs, my $1.2M portfolio surged, yielding an annualized gain of 28%.
Your advisor must be really good, how I can get in touch with them as my porfolio isn't doing well.
‘’Aileen Gertrude Tippy’’ is her name. She is regarded as a genius in her area and works for Empower Financial Services. She’s quite known in her field, look-her up.
Thanks a lot for this suggestion. I needed this myself, I looked her up, and I have sent her an email. I hope she gets back to me soon.
I like this channel talks honestly and openly about the unspoken valued things people need and ultimately get shafted on. Find other channels grey and unclear.
Really hooked on your channel. Nice and clear to understand
Hi, are you planning to update this video after the budget and the NI changes? Thanks.
Excellent video. Clear and concise
Amazing content! I have been following your videos for sometime now, consistently kicking down Wall Street doors for two years now, I have over $320k in stocks. Currently, my portfolio is down by 15%.. Wondering if they're any short term opportunities I can invest in
I agree that there are strategies that could be put in place for solid gains regardless of economy or market condition, but such executions are usually carried out by investment experts or advisors with experience. Reason I decided to work closely with an brokerage-adviser ever since the market got really tensed and the pressure became so much(I should be retiring in 17months) so I've had an brokerage-adviser guide me through the chaos, its been 9months and counting and I've made approx. 650K net from all of my holdings.
Glad to have stumbled on this comment, Please who is the consultant that assist you and if you don't mind, how do I get in touch with them?
Gabriel Alberto William is the licensed fiduciary I use. Just research the name. You’d find necessary details to work with a correspondence to set up an appointment.
He appears to be well-educated and well-read. I ran an online search on his name and came across his website; thank you for sharing
bitcoin
Thanks for this very informative video Kiran. Any suggestions on how to optimise salary for full-time working salaried individuals? If you are earning anywhere over £100k - what's the best way to ensure you pay less tax and optimise your take-home pay?
maximise your pension contributions as they are all tax free.
invest in some SEIS setup by friends. basically get pretty much all your income tax paid back that way over the last couple of years plus some of your capital gains.
eg if you were earning 100k annually you would pay 27k/year in tax so over 2 years 52k paid in tax.
put 104k into a friends business.
in 6months the government give you back 52k and 21k in capital gains relief so you have claimed. 73k out of the 104k is now back in your pocket.
your at risk amount is now 31k
if your mate messes up completely and losses your 100k investment that only cost you 31k you can also claim loss relief against capital gains tax.
so basically no lose investment.
some caveats with this like you cant give it to your mother or use on rental properties or solar panels.
@@Call_Centre_Conversationsthank you for sharing this. Could you please provide more details for the same amount 100k/year online business, no major expanses.
Would love to understand how much I could have in my pocket since I believe I cannot access pension contributions until later in life.
@@nestor.koylyakwould love to. How long has the online business been running?
Is it vat registered?
Is the business generating the income through the sale of goods or through the sale of services?
With your pension you can access the funds earlier through a few different arrangements but we need to go through more information to be better for you. For instance you may want to investigate ssas.
@@nestor.koylyak can access your pension earlier through a few strategies. One such strategy is SSAP.
100k a year online business would need to know a few more things.
For instance is it vat registered?
Is it flat or rate vat or normal rate vat.
If flat rate what is the flat rate you are on.
Do any family or friends help you out in it for instance your partner or parents.
If your parents are helping you out in it and are pensioners, then they would pay no employee national insurance.
So paying a pensioner parent for the help they do works out better.
For instance your mum may have stayed in the whole day to sign for a delivery for your business.
Thats going to be at least £100.
If your business pays her £100 then she pays 20% income tax on that then she has £80 in her pocket.
If she refuses to accept the payment then you withdraw the £100 through paye from your business then it will be at least 20% income tax and 8% employees national insurance you need to take out. So would be £72 in your pocket.
If the two of you have a common goal such as going out for dinner together, then I'm sure you can agree that you taking £100 from the business to put £80 in her pocket is better than you taking out £100 from the business to put £72 in your pocket.
@@nestor.koylyak ssaps will let you access the pension earlier
Great video. Can you do one on how/when it's beneficial to operate as a sole trader/limited company based on the business revenue and tax efficiency?
If as a sole trader you earn over the 50k basic tax rate, you’d start paying the 40% on anything over that.
That’s when you should probably transition to a limited company
You should add which jurisdictions you are giving the advice for. The UK.
Smoothly explained
Very eloquently explained.
Corporation tax at 19% is only on profits less than £50k , plus wait till we have the October budget and I won’t be surprised if that 19% rate is abolished.
inclined to agree.
come October if the budget puts the corp tax back to 20% it will be
do you want to:
A)pay corporation tax of 20% and dividend tax of 8.75%
or
B)pay 20% income tax and 8% national insurance
basically give yourself ball ache to pay more tax if you paid by dividend.
did you even watched the video? she didnt say its not ...
@@vladvld3433 the point i was making is clearly gone over your head
thanks for sharing this useful information in simple and succinct way
You're the first to consider CT and have a realistic tax rate!! What about doing this using Pension contributions to reduce CT??
Wait a minute when you earn over £100k you get the additional tax percentages on top that takes you up to 60% tax rate not 45%
Thanks Kiran, very helpful 😊 👍
Very helpful video!
Really helpful video thank you. I think the thing that irks me most is you pay corporation tax and then when you pay yourself you get taxed AGAIN on dividends - so effectively taxed twice. It's appalling!
Try being an employee. In most situations you pay more tax than a contractor.
The uk is a hell hole. Things are set to get worse.
Beautiful eyes !! Many thanks !!
Excellent, what's the best way to take out income above the £50k mark?
Dividends anything after the 12,570 remuneration is used up
would be good to compare inside and outside IR35
hands down outside ir35 is better.
inside ir35 you pay employers national insurance of 13.8%.
when you are outside ir35 you will get the small employers national insurance allowance of £5,000 so for the first £5,000 of employers national insurance you pay £0.
other problems with being inside IR35 is you can't claim travel or accommodation or subsistence.
If you are inside ir35 and running through an umbrella you got other downsides too such as paying the umbrella their fees (at least £20/week which will end up being £1000/year) as well as taking the risk the umbrella company is keeping your money.
Thanks Kiran 😊
❤ thanks for sharing your knowledge. A question if you want to maximise your pension benefits, £60k allowance, how can the director do this if salary is set to this level?
Make an ‘employer contribution’ up to that level direct from the company to the pension fund itself. Tax deductible for the company and not taxable or liable to NIC on the director so fully tax efficient.
@@Fataxman which tax ? Corporation tax or personal tax rate ?
@@feliciaflindersbecause an employer pension contribution is a business expense it would not incur corporation tax
@@kevbarker73and employer pension contributions are income tax and nic free for the employee too so nothing to pay on that side eithrr
@@kevbarker73I just learnt this after researching. My accountant never bothered informing me about it, meaning that instead of paying massive corporation tax or income tax, I could have topped up my pension. Needless to say, I am now doing it and transferring as much as possible onto the pension funds
Simple , plain speaking. Very helpful. Thank you Kiran
This video is very useful thank you. Can you do one for maximising income if someone is PAYE?
This video is brilliant
Great videos! However, in this one, there's no mention of purchasing plant and machinery (Nissan Vans included 😊). Could you also clarify if there are any benefits or reductions to Corporation Tax (CT) for a company car? Additionally, what are the differences between having an electric vehicle (EV) versus an internal combustion engine (ICE) car in terms of tax advantages?
Can you do this as a sole trader? Could an actor or a model do this for example?
But you're not going to report yourself for paying below min wage? And you could be working part time.
Great video, would you do one on capital gains vs dividends for stocks?
only face capital gains when you sell so don't sell just keep the shares and take loans against their value.
how about optmial pension contr?
What happens to money left in a limited company if you just leave it in the business account after earning it? Does it get taxed at the end of the year or does it only get taxed when it is withdrawn from the business in the form of salary, dividends etc?
It gets taxed at year end - but only for the tax year it was earned in. I.e. if you leave the money in the account for 2yrs, it is not taxed twice.
@@danielbarnard8069 thank you. I’m guessing if you then paid that money into your pension or similar then you would get the corporation tax back?
@@jonathanhowson6420 sorry am not clued up on rebates to the company Corp tax. I know you reclaim income tax relief in this manner - but the relief I believe, am not an accountant or qualified to give advice you understand, is against the ‘current’ year’s tax. So if you earned £10M last year and £10 this year - you wouldn’t save any tax at all by deferring the pension payment.
Whether that works the same for companies I would be guessing.
I am aware there are different pension options - salary sacrifice vs not for example - this may also affect your situation. It would be worth getting an accountant to have a look at your situation specifically / or at least getting a quote for one and seeing how the cost stacks up against the potential saving that could be made.
This is great for earnings of 50-60k but whats the best way to then pay yourself more above this other than getting a partner onboard and repeatibg the process?
Excellent video and exactly what I looking for thank you
Great video ! How does this advice change if the director is also drawing a full state pension of, say, £11,000 pa?
you've used up £11,000 of your £12,500 personal allowance so can only withdraw £1,500 more from the limited company before hitting the personal allowance.
however if you are a pensioner you do not pay employees national insurance and you probably be under the £5,000 employers national insurance relief so withdraw as much as you want through PAY rather than dividend.
You will only pay 20% on the PAY withdrawals v when using dividends 8.75% personal dividend tax+ 19% corporation tax
Worked example is your company has £10,000 profit. you withdraw that all as personal pay and pay 20% income tax as £2,000 putting £8,000 in your bank account.
If you were to withdraw as dividend then you would pay 19% corporation tax of £10,000 making it £1,900 payable in corp tax leaving you with £8,100 to withdraw as dividends. The first £500 will be 0% dividend tax so £7,600 will be taxed at 8.75% or £665 dividend tax leaving you with £6,935 in your bank account
One issue with this is that salary falls below minimum wage
Hi could you tell me e if I was to take £12500 salary and £50000 dividends would I save alot in tax compared to doing £62500 as a sole trader
When taking into account corporation tax and my tax an NI?
If your company makes a lot of profit, would it be better to have a directors salary of 85k as you can reduce your corp tax bill, which would be taxed at 25%.
If you have a job with a salary of 52k, and also have a Ltd company does this mean by paying a dividend your paying around 20% corporation tax then 33.75% on the dividend amount. Totaling around 55%. So in this case would paying yourself as a director assuming at 40% be the better option?
This video has either gone completely over your head or you just did not listen.
It’s specifically for Directors who earn PAYE AND DIVIDENDS from the SAME COMPANY
@@Liberty_Freedom_Brotherhood Looks like my question has gone completely over your head or you did not read, my situation is different to that of the video hence my question.
If you have a job at 52k salary, you’d be paying mainly 20% on that salary, using up all of your Basic Rate tax code.
Then say you want to pay yourself a £10k dividend out of your Ltd company, this would be taxed at the 33.75% as your total income is £62k (52k salary + £10k dividend) - you do however get a £500 free tax dividend allowance.
As your Ltd company has paid you a dividend and not a ‘salary’ which isn’t tax deductible on the company side, your business would still pay corp tax on the £10k you took out.
You can obviously only pay yourself a dividend if you have profit in the Ltd company and the corp tax is on a sliding scale with 19% only being applied to profits on less than £50k
Hope that helps
Thank you for the clarification
Hi Kiran, as director/ owner of a company, employee and employer NIC payment are both payable same as normal?
Yes they are both payable as normal but remember the companies national insurance relief of £5,000
Please would you kindly create a similar video for LLP partners drawing salaries?
@@gerrardtin3208 my understanding is that there are no dividends with a LLP so it's PAYE all the way
Think you should have mentioned you need to be a shareholder to get dividends…
NIiiiice
😊👍
Incredible amount of scam comments on these financial videos
These are very valuable rules for anybody who wants to get rich. Unfortunately, most people who will watch this video will not really be able to apply the principles. We may not want to admit, but as Warren Buffett once said, investing is like any other profession-- it requires a certain level of expertise. No surprise that some people are losing a lot of money in the bear market, while others are making hundreds of thousands in profit. I just don't know how they do it. I have about $89k now to put in the market.
Great video! I really have a question. For someone with less than $3,000 to invest, how would you recommend we enter the crypto market? I am looking at studying some traders and copying their strategy rather than investing myself and losing money emotionally. What's your take on this approach?
My advice: for newbies to grow financially this year, invest. Saving is good, but investing elevates your finances. Why newbie make huge losses on trade is because investing without proper guidance can lead to mistakes and losses. that will stop you from trading, this has been one of the biggest problem to new traders, I've learned this from my own experience
Tracy Britt Cool Consulting was my hope during the 'bear summer' last year. I made so many mistakes but also learned so much from it, and of course from Tracy.
I'm surprised that this name is being mentioned here, I stumbled upon one of her clients testimonies on CNBC news last week...
I keep hearing a lot about Mis. Tracy Britt Cool Consulting O'Reilly, she must be really good
For me it was £48k.
I’m better off on £48k than I was on £52k.
That £4k goes towards pension and shares.
I literally don’t miss it
I've got mine close enough, at £49,290
@@supersai4198 how do you feel about it?
Initially I was very bitter.
I don’t have a choice now and live with it.
where can I buy you a drink :?
WITH 10 YEARS EXP WHY WOULD YOU NEED TO REACH OUT ON YOU TUBE FOR FURTHER COVERAGE? 'DANIEL' MODE?
Hi could you tell me e if I was to take £12500 salary and £50000 dividends would I save alot in tax compared to doing £62500 as a sole trader
When taking into account corporation tax and my tax an NI?