NCD

NCD

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Small Company has its year end in May 2006. Profits around 18,000. Dividends £12,000 voted on say between 01/04/2006 to 31 May 2006. What would the Tax position be? The £15,000 ( i.e. 18,000 divided by 12 x 10 mths) will be in FY2005, subject to 19% less Marginal Relief, the reminder £3,000 will be taxed at 19% FALLING IN FY2006. The Dividends will have no impact on the CT. My Corporation Tax Software seems to calculate the 12,000 dividend within the FY2005 and at 19%. Before I contact the software Company, I will appreciate readers comments.

Sonny Duraisingham

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By Peter Cane
21st Aug 2006 10:33

Software update October?
Your software has probably not been updated to reflect the Finance Act changes abolishing the NCD rate.

Given that the Revenue themselves have advised not to file online until October, I doubt if your software program will be updated before then.

So you may want to hold fire until your software is upgraded.

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By STEVEGLOVER33
21st Aug 2006 09:13

No NCD implications
You are correct that there are no NCD implications for dividends voted on or after 1st April 2006 and therefore you should contact your software vendor to resolve the problem.

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