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I have finally got a handle on what I have done with my figures.
It looks like I am ok going the route of using the profit from last year to pay for the lack of profit to pay my dividends. There is the complication that I have also taken a Directors Loan of £5000 to be paid back in the first 6 months of new financial year. I think this is the best way to keep the company with some retained profit this year and still comply legally ( i think)
Can you see any problems with this as a way forward?
Thank you for your help!
Gary, thank you for your reply.Withdrawing money as a loan and making director's account overdrawn in the balance sheet has tax implications. You have stated that you have done so to maintain some retained profit. I would like you to reconsider that after you have considered the tax implications..
My preference would be to maximise dividends bearing in mind that they are out of taxed profits and no tax implication provided your personal income remains within basic rate tax band.More information on this can be found here
I hope this is helpful..