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Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 13884
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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I have paid myself and my partner dividends from a business

Customer Question

I have paid myself and my partner dividends from a business I run. No tax was deducted by the business in the payment. Should I have deducted 10% when paying the dividend and if necessary how and when do I pay this to HMRC (which forms or online service)
Submitted: 2 years ago.
Category: Tax
Expert:  Sam replied 2 years ago.
Hi
Thanks for your question and asking for me.
The tax is deducted by the company, but NOT paid over to HMRC as its notional tax.
What this means is that
1) that had to be sufficient income Profits) after the corporation tax was paid to pay out the dividend, and
2) say this was £10,000 then you actually would receive £9000 and the £1000 would reflect the tax credit charge of 10%
3) So you would end up with a payment of £9000 - HMRC would credit you with £1000 notional tax suffered through your self assessment and the £1000 with held by the company to represent this notional tax, is just retained in the company (so not paid to HMRC)
Thanks
Sam

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