What are the tax implications of making a non UK resident (lives in Asia), a co shareholder of a company and making dividend payments to him??
Thank you
Sandra
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i dont think higher rate is applicable.
i seem to remember that non-residents are only liable to uk dividends at 10%, irrespective of the amount received, but I think they lost the personal allowance, so only need to worry if has other source of income in UK (such as bank interest).
Bit vague I know, but hopefully someone can put some meat on these bones.
Additional tax
Thank you Euan,
In which case, as long as dividend is below 40% threshold, there will not be additional tax due (other than 10% paid at source).
None
The UK company still pays UK corporation tax on its profits and pays dividends out of the balance. The dividends come with a non-refundable tax credit which pays a shareholder's basic rate income tax liability in the UK.
Non-residents are liable to UK income tax on dividends from UK companies. If the non-resident shareholder is a Commonwealth or EEA citizen, he can claim the personal allowance, but even if this exceeds the grossed up dividend, there is no tax consequence because the tax credit is non-refundable.