Mike Cooper

Small Business Dividend Pay-Outs Soared Last Year Ahead of Tax Changes

Small Business Dividend Pay-Outs Soared Last Year Ahead of Tax Changes

Small and medium business owners in the UK chose to pay out 94% of their profits to their shareholders in 2015 rather than re-invest the money back into their business, a report from Moore Stephen has suggested. The total amount of dividend payments made by UK enterprises hit £28.3bn in 2015 to 2016, up 63% from the previous year’s total of £17.5bn. Moore Stephens suggests such a trend was heavily influenced by the recent changes to dividends tax, announced in July 2015 and introduced by George Osborne in April 2016, and the economic uncertainty caused by the EU referendum. These changes included the dividend tax rising by 7.5% to 32.5% with the government also introducing an allowance where the first £5,000 of dividend receipts in a tax year will go untaxed. Moore Stephens believe the cha... »

Business Owners to Pay Themselves Special Dividends Ahead of Tax Hike

Business Owners to Pay Themselves Special Dividends Ahead of Tax Hike

More than a quarter (28%) of UK small business owners are planning to pay themselves a special dividend ahead of the forthcoming dividend tax hike in April, according to a report by Moore Stephens. Announced earlier this year as part of the Summer Budget, the tax rate on dividends for higher earners will increase from 25% to 32.5% – with the rate for additional tax payers increasing from 30.56% to 38.10%. The survey of business managers also found that over a fifth (21%) of small business owners will reduce their dividend pay outs once the changes come into force, while just 6% expect to increase dividends to maintain their net income. The news follows an ongoing petition calling on George Osborne to reconsider the changes to dividend tax. The petition has now been signed by over 57,... »