PTP's Tax Tip No.7 ' Non corporate distribution rate with losses

Q: My company always has profits in excess of £50,000 per annum with a similar sized dividend paid each year but this year an onerous contract will create a loss. Will I be affected by the 19% non corporate distribution rate on the £40,000 dividend I intend to pay this year?

A: No. If the company has no taxable profits this year then the NCD rate of 19% cannot apply to anything.

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