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Ask Your Own Question, Chartered Certified Accountant
Category: Tax
Satisfied Customers: 5143
Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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I'm a new Ltd co. for tax purposes. I have been drawing out

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I'm a new Ltd co. for tax purposes. I have been drawing out most of my profit less the anticipated tax on it. Is this ok? eg profit £6000 I pay myself in one bank transaction £4200 each and every month. Because that is my monthly expenditure at home. IS there anything I need to be aware off?

Hello and welcome to the site. Thank you for your question.

You have stated that you have been drawing out most of your profit after tax provision. There is nothing wrong in that.. this amount would be deemed dividend if you have not taken any salary under PAYE. If you have used some of this as salary then the balance would be treated as dividend.

You should be aware if your dividends and salary exceed the threshold for basic rate of tax, then some of the dividends paid would be taxed at higher rate.

More information on how dividends are taxed is covered here

I hope this is helpful and answers your question.

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