How to pay yourself £65,000 take home over £61,500

Being the taxpayer

Cost of living day to day in the UK is constantly increasing, now is a time to make the most of the money you’ve worked hard for.

Tax planning for any person is paramount to make sure you take advantage of the constantly changing tax landscape. As a Ltd company director taking the hard work of creating and running your business, so don’t leave tax planning as a side task.

So can you take home over £61,500 from £65,000? Let’s break it down.

Salary: £12,570 - Use your full personal allowance, £0 Inc Tax, Employers NIC are £1,135, but these can be offset by corporation tax relief.

Dividends: £37,340 - Within the basic rate band of 8.75% - leaves a dividend tax of £3,255. Not bad considering Inc Tax is 20% in this band.

Pension: £15,000 - Paid for from the company and fully deductible for corporation tax. Pay it into an SIPP or employer scheme, which includes your 20% tax relief.

And there we go, £65,000 broken down.

Want to know more about tax planning or how to get the most out of your money?

Reach out to Taylor & Associates today, and make your money work for you.